Outbound tourists are the biggest Indian job creators abroad

Outbound tourists are the biggest Indian job creators abroad
Outbound tourists are the biggest Indian job creators abroad

Indians spend an estimated $20 billion on their travels around the world, boosting local economies and creating jobs. A WTO study says this figure will rise to $60 billion by 2020, or about the same as the total FDI inflow into India last year. Let us start with two simple quiz questions: Which Indian group has spent the largest sum of money in the US since the turn of the millennium And ditto for Europe Okay, here's are a few hints: it's not the Tata Group, not the Aditya Vikram Birla Group and not even any overseas Indian-owned business like Arcelor Mittal. The answer - surprise - is: the ordinary Indian. Since 2000, the number of Indian tourists visiting the US annually has risen from 250,000 to 1.2 million in 2015. They spent about $12 billion on shopping, eating, travelling, commuting and staying at hotels and patronising home stays. The answer for Europe is even larger. At last count, an estimated 2.5 million Indians visited Europe in 2016, adding almost $3 billion to the local economies of individual countries. And every year, as millions of Indians travel around the world on business trips, to attend conferences and meetings, study, shop, honeymoon, sight-see and visit friends and relatives, they cumulatively spend an estimated $20 billion. Tourist spends outstrip FDI Indian groups such as the Tata-owned Indian Hotels, which runs the Taj Group, the now-in-trouble Sahara Group, Bharat Hotels and a few others have acquired or set up iconic properties such as the Pierre and the Plaza in New York and Grosvenor House in London (the latter two have since been sold to non-Indian buyers). Then, Bharat Hotels has also recently launched a new luxury hotel in the British capital. Total outbound foreign direct investments in the hospitality sector, at a few hundred million dollars a year, is a fraction of the sums Indian tourists spend abroad, contributing billions to the local economies and creating and sustaining jobs in a range of sectors as diverse as food and beverages, hotels, education, airlines and luxury brands, among many others. Exit the high spending American, enter the high spending Indian There was a time when Americans were the most sought after tourists the world over - with good reason. They spent big, tipped generously and lived life king-size while travelling the globe. The United Nations World Tourism Organisation (WTO) estimates that Indians are among the highest spending tourists in the world - spending, on average, four times as much as the average Japanese or Chinese tourist. The average Indian spends about $1,200 per trip compared to $700 for the average American and $500 for the average Briton. Indian tourists spent almost $20 billion on their foreign travels in 2015 and this figure is estimated to grow at 12 per annum. On average, Indian tourists travel for 12-15 days and spend a disproportionately large amount of money on the purchase of branded luxury goods. Rolling out the red carpet India is now the world's second-largest source of outbound tourism, after China, and according to a World Trade Organisation study, this figure will grow exponentially to 50 million by 2020. Assuming a constant rate of spend, that is $60 billion of hard cash that Indian tourists are expected to spend on their foreign travels in three years' time. Interestingly, that is almost equal to the total FDI inflows into India in 2016-17. Little wonder then that airlines, cruise liners and tourism promotion agencies worldwide are pulling out all stops to woo the Indian traveller. To serve this growing market, almost every airline has direct flights connecting major Indian cities like New Delhi, Mumbai, Bangalore and Chennai to major capitals, financial centres and tourist destinations in Europe, the US, the Middle East, South East Asia, China and East Asia. Germany has stolen a march over other European countries in wooing Indian tourists. Its national airline Lufthansa, which has direct flights from India to almost every major European city, now offers Indian flyers the choice of Indian cuisine and has on-board attendants trained in Indian cultural nuances. Then, the German National Tourist Office has organised a three-day roadshow in India to encourage tourists from this country to visit Germany. Following the Bollywood stars According to the World Bank and UNTWO data, Dubai, Thailand, the US and Singapore are the destinations favoured most by Indian travellers. This is followed by the UK, Australia, Indonesia, Turkey, Sri Lanka. In recent times, East European countries such as Hungary, Slovakia, Poland as well as Greece, Spain and Portugal have gained popularity. Analysts say a spate of recent Bollywood films that were shot in these countries is responsible for this boom in Indian tourist arrivals there. Of course, age-old favourites like London, Scotland, Paris, Switzerland and Germany continue to remain on the itinerary of most Indian travellers. And the US, as mentioned above, remains a perennial favourite. To cash in on the demand, a number of airlines have launched direct flights between the two countries. Air India, which has direct flights to New York from New Delhi and Mumbai, has launched tri-weekly non-stop flights between Bangalore and San Francisco and a daily non-stop flight between New Delhi and Washington. Waking up somewhat belatedly to the potential of the high spending Indian tourist, several European and African countries have opened offices in major Indian cities to promote tourism. The MICE market A relative new trend in the multi-billion-dollar Indian outbound tourism market is the practice of holding corporate off-sites and senior management retreats at exotic locales around the world. Dubbed Meetings, Incentives, Conferences and Events, and going by the unlikely acronym of MICE, this generates an average of 1.5 million outbound travellers from India. Tourism boards from many European, African and South East Asian countries have been aggressively courting this market, because such offshore components typically have windows for shopping and sightseeing as well. Since the participants are mostly senior management personnel of large and medium companies, they are seen as high spenders who patronise luxury resorts and add great value - by generating jobs and creating demand for merchandise - in the local economies. Booming economy Fuelling this boom in outbound travel is the growing and increasingly well-off Indian middle class of young, educated tech-savvy people numbering 350 million. This is projected to rise to 550 million by 2030. With India's GDP growing at more than 7 per cent, which is expected to rise higher on the back of the reforms push by the Narendra Modi government, India's outbound tourism market is expected to continue to grow at a scorching pace. One industry that has boomed as a result of the average Indians' wanderlust is the low-cost aviation sector. There has been a boom in this sector within India and several foreign airlines have also commenced operations from the country, serving the important tourist routes. However, investments in foreign facilities by large Indian hospitality chains such as the Taj, the Oberoi, The Lalit and ITC have not kept pace with the growth in outbound tourism from India. So, the average Indian traveller, considered cumulatively, is expected to remain the largest spender of foreign exchange in India. The UNTWO expects tourism to create almost 300 million jobs globally and generate 9 per cent of the world's GDP by 2019, making it, by far, the single largest source of economic growth. And Indian travellers will be at the forefront of this boom, silently and invisibly creating new economic opportunities and generating jobs for people all over the world.

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