- India travel market grew 1pc to $41.7bn in 2025
- Market forecast to rebound 13pc to $47.2bn in 2026
- Airline sector projected to expand 16pc
- Domestic visitor spending accounts for 86pc of tourism spending
- Business travel spending to climb 8.7pc to $46.9bn
India’s travel market has grown only 1pc to $41.7bn (€38.8bn) in 2025 after stronger expansion the year before, according to Phocuswright. Online bookings rose 4pc while offline declined, pushing online penetration to 57pc. Air travel was the weakest segment due to operational issues, but car rental grew as travellers chose road trips. The market is forecast to rebound by 13pc to $47.2bn (€43.9bn) in 2026, driven partly by higher airfares and resilient domestic demand, before moderating in later years.
India’s travel market is projected to rebound by 13pc to reach approximately $47.2bn in 2026. This turnaround follows a stagnant 2025, where growth slowed to just 1pc due to airline operational disruptions and high jet fuel costs. According to data from the Phocuswright India Travel Market Essentials Report, the market recovery is being fueled by robust domestic travel intent, corporate travel growth and an inevitable hike in airfares.
The airline sector is forecast to expand by 16pc in 2026. However, this is heavily influenced by higher airfares as carriers pass down severe fuel-cost pressures. To protect the market, the Indian government has pledged up to ₹10,000 crore (around $1.04bn or €0.97bn) in price-stabilisation support for aviation fuel. Domestic visitor spending accounts for roughly 86pc of all tourism spending in India, and business travel spending is set to climb 8.7pc year-on-year to hit $46.9bn in 2026.
