Tourism Sector in India, Challenges, Growth and Significance

The tourism sector in India is a vital contributor to the economy, showcasing rich cultural heritage, diverse landscapes, and spiritual experiences that attract global travelers.

Table of Contents

Context: The US decision to raise tariffs on Indian exports highlights the risks of overdependence on limited trade partners. India must diversify its economy, and tourism offers a powerful alternative.

Growth and Significance of Tourism Sector in India

Economic Contribution: Contributed ~5% of GDP (FY 23).
Employment Generation: Highly labour-intensive (created 7.6 crore jobs in FY23); can create 40 million jobs with sectoral expansion.
Foreign Exchange Earnings: $28 billion earned in 2024; potential to rise to $130–140 billion.
Global Ranking: Travel and Tourism Development Index (TTDI) 2024 report published by the World Economic Forum (WEF), India is ranked 39th among 119 countries (54th/117 in 2021)
Balanced Growth: Supports both urban high-skilled jobs and rural livelihoods (transport, handicrafts, wellness).
Soft Power Diplomacy: Promotes India’s culture, heritage, Ayurveda, and spirituality globally.
Green Growth Driver: Sustainable tourism fosters low-carbon growth with community benefits.

Challenges Facing Tourism in India

Low GDP Contribution: Only 5% of GDP (vs. global average 10%), below global and peer country averages.
Infrastructure Deficit: Inadequate infrastructure in remote areas and the lack of global-standard amenities limit tourism growth.
- Eg., India has only 1.8 lakh branded hotel rooms vs the demand of 5–6 lakh.
Ease of Travel Issues: Visa delays, long immigration queues, and poor connectivity.
Fragmented Promotion: Weak global branding, underuse of digital content/influencer marketing.
- Eg., India received 6.19 million foreign tourists in 2022, far below Thailand (11 million) and Spain (71 million).
Investment Barriers: Limited private investment; Public-Private Partnership (PPP) potential is untapped.
Sustainability Concerns: Over-tourism, waste management, and ecological stress in fragile areas.

Government Initiatives

Initiative	Focus Area	Key Features / Impact
Swadesh Darshan Scheme	Theme-based tourism circuits	Infrastructure for 13 circuits – heritage, eco, spiritual, coastal, etc.
Northeast Tourist Circuits	Regional tourism	₹1,200 crore allocated for 8 Northeastern states under Swadesh Darshan.
PRASHAD Scheme	Pilgrimage & spiritual tourism	Modern facilities at major religious sites boost spiritual & heritage tourism.
Swachh Bharat Abhiyan	Cleanliness at tourist sites	Improves hygiene, cleanliness & visitor experience at monuments and destinations.
All India Tourist Permit Rules (2021)	Ease of travel	Online application for tourist vehicle permits across India.
Dekho Apna Desh	Domestic tourism	Webinars & campaigns promoting India’s cultural and natural diversity.
Swadesh Darshan 2.0 (2023)	Sustainable tourism	Revamped scheme focusing on responsible & sustainable destinations.
Battlefield Tourism Promotion	Cultural & adventure tourism	Bharat Ranbhoomi Darshan app showcases India’s military heritage, esp. border regions.
Thematic Tourism Promotion	Diversified offerings	Promotes wellness, culinary, eco-tourism & niche segments globally.
e-Visa Facility	International arrivals	Expanded to 171 countries; easier entry for tourists.
GST Reduction	Affordability & competitiveness	Lower hotel tariffs via reduced GST.
RCS–UDAN Scheme	Regional connectivity	Expands affordable air travel to underserved destinations.
IITF Certification & NIDHI+	Innovation & quality	Supports tourism startups, improves service standards.

Way Forward

Destination Development: Build 50 world-class destinations, blending infrastructure, sustainability, and branding.
Travel Facilitation: Simplify e-visas, modernise airports, and expand airline connectivity.
Digital Promotion: Use AI, influencers, and global platforms for strategic storytelling.
Investment Push: Include more tourism projects in the infrastructure list; encourage PPPs in hotels, ropeways, and amenities.
Domestic Tourism Boost: Expand the Dekho Apna Desh campaign; make inter-state travel affordable.
Sustainable Tourism: Promote wellness, eco-tourism, and medical value travel while protecting local ecology.