The travel industry is concerned with providing all services that are related to the movement of people from one place to another. The tours are not only driven by the purpose of leisure but also by business and other motives. It includes the hospitality industry, hotel industry, the transport industry, and others.
From the industry point of view, it is one of the largest industries in the world with the economies of countries such as Macau, Maldives, Aruba driven by their tourist trade. The whole industry strives to figure out how to provide travel services in such a way that not only the tourists could be served better, but they return to you for the next trip.
Sectors of the Travel and Tourism Industry
In a broader sense, although both the travel and tourism industries are interlinked as they cater to the needs of tourists, it is important to realize that they are different from each other when it comes to the scope of the industry. While the tourism industry is concerned with providing end-to-end tour planning and strategizing platform, the travel industry covers a wider number of travel purposes which include trips to non-tourist destinations. However, both the industries share a few sectors which offer a wide range of benefits:
1. Transportation: The transportation sector is concerned with not only providing the means to get to the intended destination but also assist with getting around and exploring the destination. This sector includes services related to air, road, water or rail travel.
2. Hospitality/Accommodation: The most major source of revenue contributor in the Travel and Tourism Industry, this sector provides the answer to the lodging and accommodation needs once the tourists arrive at their destination. This sector includes industries such as hotels, camping, shared accommodation, hostels and so on.
3. Food & Beverage: The food and beverage sector serve the interesting role of providing tourists with necessary refreshments at all stages of their travel journey such as during commute, accommodation and exploring. In addition to that, the food and beverages sector also offers tourists the opportunity to socialize, make new friends and enjoy themselves over food.
4. Entertainment: While most people travel with the purpose of change in routine or a change in lifestyle, some tourists travel to pursue new means of entertainment. They may be drawn to these destinations due to the unavailability in their location, or simply to experience the general entertainment at a new location with new people. Thus, the entertainment industry ideates this need and offers attractions to capitalize on this culture. This includes casinos, shopping malls, cultural destinations amongst a few.
Indian Market Scenario
The Indian travel and tourism industries are interwoven with the country’s economy and have been identified as one of the key drivers of economic growth among the services sector of India. India has moved 12 positions ahead from 52nd to 40th rank in Tourism and Travel Competitive Index (WEF). In contrast, the diversity of cultures and traditions of the country is what attracts the tourists to India as compared to other countries. The vast country offers multitudinous options: 35 world heritage sites, 110 national parks, Rajasthan’s hill forts, the holy cities of Varanasi and Haridwar, everything else in between the mesmerizing mountains of the Himalayas and the beautiful beaches of Goa; and then there is the Taj Mahal in Agra. Add the multiple jungles with tigers, elephants and the last of Asia’s lions, and no other country is better placed to exploit the tourism industry as India does.
According to a recent report issued by the World Travel and Tourism Council (WTTC), India is placed third on its power ranking with a revenue generation of USD 247 Billion in 2018 which accounted for about 6.7% to GDP. According to a report issued by the Boston Consulting Group, the Indian travel market is expected to grow at 11-11.5% to the extent of USD 48 Billion by 2020 with Air Travel expected to be the biggest contributor, expected to grow at 15% to USD 30 Billion. The hotel industry will grow at 13% to USD 13 Billion by 2020 while Railways remain largely stable at USD 5 Billion.
Domestic demand (business and leisure) and foreign demand will be the key drivers in this acceleration of growth. The Government has also increased spending on tourism infrastructure and introduced 100 per cent FDI in this sector.