Skip to content

Search

Latest Stories

India leads Asia Pacific hospitality despite tax hurdles

High taxes in the country hinder building global hospitality brands

India leads Asia Pacific hospitality sector growth in 2025

India is leading in Asia Pacific hospitality, driving domestic growth and outbound travel despite a 19 percent drop in regional investment in the first quarter, according to Colliers India. Pictured is the Taj Lake Palace in Udaipur, Rajasthan.

INDIA IS EMERGING as a central force in the Asia Pacific hospitality sector, driving domestic growth and outbound travel to key regional destinations, according to Colliers India. While Asia Pacific hospitality investment fell 19 percent in the first quarter of 2025, India’s role is reshaping the landscape and supporting valuations.

Colliers’ May 2025 Asia Pacific Hospitality Insights report noted that the sector’s momentum from 2024 has continued into 2025, shifting toward performance-led growth.


“India is driving a structural shift in Asia Pacific’s hospitality landscape, with resilient domestic growth while emerging as a powerful outbound force,” said Nikhil Shah, Colliers India’s managing director for hospitality and alternatives. “With strong demand across luxury, lifestyle, and MICE segments, and rising investor confidence in experience-led assets, India is now central to sustaining premium pricing and reshaping travel dynamics in the region. Despite limited liquidity in the investment market, robust valuations persist—not driven by rate-based transactions, but by long-term conviction in the sector’s future.”

Separately, Puneet Chhatwal, managing director and CEO of Indian Hotels Co. Ltd, said India has potential to attract foreign tourists, but high tax rates remain a major barrier to building global hospitality brands, according to PTI. He called for an “additional push,” citing the infrastructure status granted to 50 tourist destinations in this year’s Budget and reiterating the long-standing demand for industry status.

“If you are the highest taxed sector in every possible way—GST, excise, paying all charges during COVID when your business was shut—with the least budget for promotion or marketing the destination and just relying on what we have, then how are you going to create those kinds of global brands on your own?” he asked.

Outbound travel market

A key development is the growing Indian outbound travel market, fueling hospitality in destinations like Thailand, Vietnam and South Korea, Colliers said. Rising incomes and demand for experience-based travel provide steady, year-round demand, supporting room rates and changing regional hospitality dynamics.

Govinda Singh, Colliers’ executive director for APAC capital markets, hotels, hospitality and advisory, noted the traditionally slow first quarter and cautious “wait-and-watch” approach amid geopolitical uncertainty.

“However, as market conditions stabilize and the imperative to deploy capital intensifies, a pickup in activity is anticipated as the year progresses,” he said. “With pricing holding firm, investors are shifting away from cap rate compression and toward value-add strategies focused on cash flow and income growth to drive returns.”

Strong domestic market

Domestically, the Indian hospitality sector outlook remains strong, with tier II cities set to drive future growth, the report found. Spiritual tourism is a key driver of inbound travel, with towns like Ayodhya, Dwarka, Puri, Shirdi, Tirupati and Varanasi opening new investment opportunities supported by government policies and infrastructure development.

Despite limited liquidity, India’s valuations remain strong, driven by long-term conviction rather than cap rate-based transactions, Colliers said.

Across Asia Pacific, hotel performance held steady in the first quarter of 2025, supporting deal activity. RevPAR rose 2.1 percent year-on-year, up from 0.4 percent growth in 2023–24, driven by ADR growth and higher occupancy. New Delhi and Mumbai led ADR growth in the region, alongside Phuket, Tokyo and Osaka, reflecting strong domestic demand, rising international travel and effective market positioning.

Chhatwal said India is a market of aspiration, not just scale.

“The next 500 million middle-income travelers will emerge with disposable income and global travel ambitions, positioning India differently domestically and globally,” he said at the Confederation of Indian Industry’s Annual Business Summit in New Delhi.

Referencing Finance Minister Nirmala Sitharaman’s budget speech, he said, “We at least got infra status for 50 destinations we’ve been fighting for, including industry status, which is a state subject. All associations worked well to get here, but now we need an additional push.”

In her February 1 Budget speech, Sitharaman said the top 50 tourist destinations will be developed with states through a challenge mode. States must provide land for key infrastructure.

A recent JLL India report projects $1 billion in hospitality investments by 2028, up from 340 million dollars in hotel transactions last year. Similarly, a Rubix Data Sciences report forecasts steady industry growth despite regional tensions, with revenue surpassing 12.8 billion dollars by 2027.


More for you

Ranju Alex appointed CEO of Accor South Asia to lead major hotel expansion with InterGlobe JV

Alex is Accor’s South Asia CEO

Summary:

  • Accor Ltd. named Ranju Alex CEO for South Asia.
  • The former Marriott executive received the Bharat Gaurav award.
  • The appointment follows the Accor-InterGlobe joint venture formed earlier this year.

Ranju Alex is Accor Ltd.’s new CEO for South Asia, which includes India, Bangladesh, Pakistan and Sri Lanka. She will lead the company’s business and growth strategy in the subcontinent.

Keep ReadingShow less
IHCL expands portfolio past 550 hotels with ANK, Pride, Brij partnerships
Photo credit: IHCL

IHCL grows portfolio past 550 hotels

Summary:

  • IHCL expands portfolio past 550 hotels by through acquisitions and partnerships.
  • Promoters of ANK, Pride and Brij come from the Clarks Hotels family.
  • ANK and Pride operates midscale hotels, Brij focuses on the boutique and experiential segment.

THE INDIAN HOTELS Co. Ltd acquired a controlling stake in ANK Hotels Pvt. Ltd and Pride Hospitality Pvt. Ltd and signed a distribution agreement with Brij Hospitality Pvt. Ltd. The deals expand IHCL’s portfolio to more than 550 hotels, increase its midscale presence to over 240 properties and add the Brij brand.

Keep ReadingShow less
Mahindra Holidays plans 10,000 hotel rooms by 2030 amid India tourism boom
Photo credit: Club Mahindra

India's Mahindra maps 10,000-room expansion

Summary:

  • MHRIL targets 10,000 rooms by 2030, up from 5,700.
  • It is exploring new models to become more competitive.
  • It calls the goal “conservative” amid India’s post-COVID tourism boom.
MAHINDRA HOLIDAYS AND Resorts India Ltd., a subsidiary of Mahindra Group, is aiming to have 10,000 rooms by 2030. The company is expanding beyond vacation ownership into the travel and tourism sector, Anish Shah, Mahindra Group CEO and managing director, said in an interview with PTI Videos.

MHRIL, led by Managing Director and CEO Manoj Bhat, had 5,794 keys as of June 30, 2025, and plans to add about 1,000 rooms this fiscal as part of its target to increase its room count to 10,000 by the 2030 fiscal, according to PTI.

Keep ReadingShow less
US Tops India’s Inbound Tourism in 2024
iStock

U.S. led India’s inbound tourism in 2024

Summary:

  • India received 9.95 million foreign tourists in 2024, up from 9.52 million in 2023.
  • U.S. led India’s inbound and outbound travel in 2024 with 1.8 million American visitors.
  • The UAE was the top overseas destination for Indians, hosting 7.7 million travelers.

THE U.S EMERGED as India’s largest inbound tourism market in 2024, sending 1.8 million visitors, according to the India’s Ministry of Tourism. The U.S. also ranked among the top destinations for Indian travelers, welcoming more than 2.1 million visits last year.

Union Minister for Tourism and Culture Gajendra Singh Shekhawat said these figures signal strong momentum in both inbound and outbound travel, The Tribune reported.

Keep ReadingShow less
Marriott & Brigade Plan Six New Hotels Across India
Photo credit: Marriott International

Marriott, Brigade eye six hotels across India

Summary:

  • Marriott and BHVL plan six hotels with 940 rooms in four Indian markets.
  • Bengaluru-based BHVL is a subsidiary of Brigade Enterprises Ltd.
  • BHVL recently launched a $101.2 million IPO, including a $14.4 million pre-IPO placement.

MARRIOTT INTERNATIONAL AND Brigade Hotel Ventures Ltd will open six hotels totaling 940 rooms across four markets in India. The projects will be developed under five Marriott Bonvoy brands: The Ritz-Carlton, JW Marriott, Marriott Hotels & Resorts, Courtyard by Marriott and Fairfield by Marriott.

Keep ReadingShow less