- Anand Rathi: India’s travel sector to grow 7 percent by 2035.
- Growth is driven by infrastructure expansion and domestic demand.
- Travel demand is shifting globally, especially among younger travelers.
INDIA’S TRAVEL AND tourism sector is projected to grow at 7 percent compound annual growth rate through 2035, according to Anand Rathi Investment Banking. Europe was the largest inbound tourism market in 2025.
Anand Rathi’s “Global Travel & Tourism Report” also found that younger generations are driving demand and allocating a larger share of income to travel. It stated domestic visits reached 18.6 billion during 2014–24, while foreign exchange earnings nearly tripled to about 226 billion U.S. dollars.
The report said growth in India is supported by infrastructure expansion and domestic demand. It noted domestic visits rose to 18.6 billion during 2014–24 from 6.8 billion during 2004–13. It said the sector contributes Rs15.7 lakh crore (5.2 percent of GDP) and supports more than 76 million jobs across the value chain.
On Europe, the report said the continent recorded 714 million international tourist arrivals in 2023, reaching 96 percent of pre-pandemic levels. The report also noted the Schengen Area enables visa-free travel across 27 European countries, supporting cross-border tourism.
"Travel and tourism contributed around EUR1.9 trillion to Europe's GDP in 2023, representing around 9 percent of the region's economy," the report said.
Globally, the report said the travel and tourism market is projected to reach about $16.5 trillion U.S. dollars, growing at 4 percent CAGR. It said the sector contributes about 10 percent of global GDP and supports more than 350 million jobs worldwide.
The report said travel demand is shifting globally, especially among younger travelers. It said Gen Z and Millennials take about four to five trips annually and allocate about 29 percent of their income to travel.
On technology adoption, the report said AI is reshaping the sector. It said AI now influences up to 58 percent of online travel bookings, while AI-powered pricing engines generate up to 168 million price recommendations per minute.
Prime Minister Narendra Modi recently urged Indians to reduce overseas discretionary spending, including foreign holidays and destination weddings, amid the Iran conflict.
