India’s domestic air traffic has reached a record high, with 456,082 passengers flying on a single day, which was achieved on 30 April. This milestone was reached as 2,978 flights took off across the country.
Domestic passenger traffic has skyrocketed after Covid, reflecting India’s high growth. India’s post-pandemic economic recovery has spurred a travel boom, with more than 37.5m passengers carried by domestic airlines in the first three months of 2023, marking a 51.7 percent growth compared to a year ago.
“There was no growth for two years during Covid, and what we are witnessing now is a snowballing of that pent-up demand. The rise in passenger traffic is also attributed to a significant increase in the number of first-time flyers since the pandemic, according to aviation analyst Mark Martin. Air traffic in India has typically been growing at twice the pace of the country’s GDP, as disposable incomes rise in Asia’s third-largest economy.“
A report from trade body International Air Transport Association (IATA) showed that domestic traffic in India had continued to approach pre-pandemic levels and was down just 2.2 percent on February 2019 levels. India was also the top domestic market in terms of passenger load factor compared to countries such as the US, China, Japan, Australia, and Brazil, with 81.6 percent load factor.
This trend presents a golden opportunity for the hospitality industry to tap into a growing market of domestic travellers who are looking to explore their own country. With the easing of restrictions and a growing sense of safety among the public, domestic travel is likely to continue to rise, generating significant revenue for hotels and resorts.
According to a report by the Ministry of Tourism, the number of domestic tourist visits in India was 677.63 million in 2021. This increase is indicative of a growing trend towards domestic travel, which is being fuelled by a number of factors. For one, the pandemic has made people more cautious about travelling abroad, which has led to a greater interest in exploring local destinations. Additionally, the Indian government has been promoting domestic tourism through various campaigns, such as the “Dekho Apna Desh” initiative, which aims to encourage Indians to explore their own country.
The rise in domestic travel has been particularly noticeable in popular tourist destinations like Goa, Rajasthan, and Kerala. Goa, for example, has seen a surge in domestic visitors, with hotels and resorts reporting occupancy rates of over 90 percent during the peak season. Similarly, Rajasthan has seen a rise in domestic tourism, with hotels and resorts in Jaipur reporting occupancy rates of 70-80% during the winter season. These numbers are a testament to the fact that domestic travel is not only on the rise but also generating significant revenue for the hospitality industry.
The rise in domestic travel is not only a short-term trend but also a long-term opportunity for the hospitality industry. With a population of over 1.3 billion, India represents a vast and largely untapped market for hotels and resorts. The potential for growth is enormous, and the industry has an opportunity to tap into this market by developing new properties, upgrading existing ones, and offering unique experiences that cater to the needs and preferences of Indian travellers.
Another way in which the hospitality industry can tap into the domestic market is by offering affordable luxury. While foreign tourists may be willing to pay a premium for luxury accommodation and experiences, domestic travellers are often more budget-conscious. However, this does not mean that they are not willing to pay for quality. Hotels and resorts that offer affordable luxury, such as boutique hotels and eco-resorts, are likely to appeal to domestic travellers who want to enjoy a luxurious experience without breaking the bank.
The hospitality industry can capitalize on this trend by offering unique experiences that cater to the needs and preferences of Indian travellers and by developing new properties and upgrading existing ones to meet the growing demand. As more and more Indians take to the skies and hit the road to explore their own country, the future of the hospitality industry in India looks bright, and it is up to hotels and resorts to seize the opportunity and tap into the potential for growth.