Forex earnings from tourism in India rising despite dip in tourist inflow

Foreign exchange earnings reaching pre-pandemic levels

Foreign exchange earnings from tourism in India are inching towards the pre-pandemic levels, although the country is yet to record similar highs in the number of visiting tourists.

The latest data for October 2023, released by the Centre for Monitoring Indian Economy (CMIE), shows that the number of foreign tourists arriving in India has shrunk by 14.1 per cent compared to October 2019 when there were 0.9 million visitors.

While still below the pre-Covid levels, tourism foreign exchange earnings continue to climb, reaching $2.3 billion in October 2023, compared to $2.5 billion in October 2019 (chart 1). In the last four years, the highest earnings were in December 2019, when it reached $3.2 billion. It plummeted to $0.01 billion in April 2020, the lowest since 2019.

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The Covid pandemic put the brakes on foreign tourists visiting the country, with less than 3000 arrivals in April 2020. The sector is gradually reviving since last year.

According to data released by the Ministry of Tourism for October 2023, Bangladesh was the largest source of foreign tourists, accounting for 21.4 per cent of all arrivals, followed by the US (15.7 per cent), UK (11.3 per cent), Australia (4.4 per cent), and Canada (3.8 percent)

Two-fifths of the Indians travelling abroad went to two countries in the Gulf region. The top destinations for outbound Indians were the United Arab Emirates (27.6 per cent) and Saudi Arabia (11.4 per cent).

Other top destinations included Thailand (5.6 per cent), US (4.9 per cent) and Singapore (4.8 per cent).

In an attempt to boost tourism, the ministry has revamped initiatives such as Swadesh Darshan Scheme to Swadesh Darshan 2.0, and also launched initiatives like Dekho Apna Desh and providing facility for e-visa for categories such as tourist, business, medical and conference visas.

In October 2023, foreign tourist arrivals were primarily motivated by leisure, holidays and recreation, with a share of 47.6 per cent visiting with this stated purpose. Medical tourism accounted for 7 per cent of arrivals, followed by business and professional travel (11.8 per cent). Also, 24.25 per cent of visitors were part of the Indian diaspora.

For each foreign arrival, there were three Indian departures, shows the data.

However, Indians are increasingly travelling more. In October, 2.21 million Indians travelled abroad — a 3 per cent jump from the 2019 levels (chart 2).

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The footfalls by domestic travellers are nearing pre-pandemic levels. Recent data shared by the ministry shows that in 2022, 1.73 billion domestic tourists visited different parts of the country, an increase from 0.67 billion in 2021 (chart 3).

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