Travel and hospitality sector showing signs of strong revival after being hit by Covid-19
Owing to pent-up demand and removal of travel restrictions across the globe, the Indian travel industry is in a strong recovery mode.
Published: 17th April 2022 07:37 AM | Last Updated: 17th April 2022 07:37 AM | A+A A-
After struggling for over two years due to covid-19 induced restrictions, the travel and hospitality sector is showing signs of a strong revival. If data issued by travel service providers are to be believed, in recent weeks there has been a strong surge in flight and hotel bookings, with the peak summer holiday season heading towards pre-covid level.
“Across a majority of holiday destinations, and hotels are witnessing over 80% room bookings. So yes, there is optimism amongst industry players and the upcoming vacation season looks promising,” Pradeep Shetty, joint honorary secretary, Federation of Hotel & Restaurant Associations of India (FHRAI) told TNIE. He added that footfalls are gradually showing indication of returning to pre-pandemic levels and the rates too have restored to what they were two years ago.
Talking about the factors driving the growth, Shetty said, “The resumption of international commercial flights at 100% capacity along with domestic tourists revenge travel trend has been one of the main factors. Other than this, hotel room tariffs across the country were heavily discounted and this too proved to be an incentive for the domestic travellers. Even the events segment including exhibitions, meetings and conferences have come back in full swing.”
Online travel booking platform EaseMyTrip on Thursday said that it has witnessed up to 50% increase in advance air ticket bookings for the coming summer period and the long weekend beginning Good Friday. It added that owing to pent-up demand and removal of travel restrictions across the globe, the Indian travel industry is in a strong recovery mode.
The publicly-listed company also said it has witnessed a 20-30% jump in forward bookings for international travel for the months of May and June. According to EaseMytTrip, domestic destinations such as Himachal Pradesh, Kashmir, Rajasthan and Goa are among the most popular ones, while international destinations such as Dubai, Maldives, Thailand and the US are in heavy demand.
Data issued by the ministry of civil aviation also indicates that domestic traffic is heading toward pre-covid level. Domestic departure passenger count is hovering around 3.50 lakh mark per day since one week with nearly 3.93 lakh passengers taking domestic flights on April 14, just shy of the pre-covid figure of 4 lakh daily departures.
International movement too is recovering with nearly 64, 000 departures from India on 371 flights as on April 15. Shreerang Godbole, SVP - product & chief service officer at hospitality major OYO, said, “Travel optimism is at an all-time high across the country…Overall, this summer is set to be the season of pre-pandemic travel recovery.”
OYO had this week said that it received more than 3.10 lakh bookings for the last festive weekend (Navratri, Durga Puja & Ashtami), its biggest booking so far in 2022, and surpassing weekend bookings for peak travel days such as Republic Day, Holi, and Valentine’s Day.
The industry, however, is wary of rising airfare due to a sharp jump in jet fuel prices since the beginning of this year and escalation of the Russia-Ukraine war. According to experts, there has been a 20-40% increase in domestic and international flight tickets and this certainly has an impact on tourists who are on a budget.
Inflation in March was nearly 7%, and the same was reflected in transport and communication inflation. Fuel prices increased by 7.5% while transport and communication inflation went up by 8%. Unless the government intervenes and cuts taxes on fuel prices, the burden of inflation could only weigh down discretionary spending like travel and tour.
Add to this, a slow pickup in Covid-19 cases in Delhi-NCR is being closely tracked by the industry as the last thing it would want is another wave of Covid-19 infections. But the industry is hopeful the pick-up in travel and tourism activities go on without interruptions.
Shetty said that at present, travel is active on all fronts including business travel, MICE (meetings, incentives, conferences and exhibitions), social gatherings and events, leisure travel, staycations, short trips and vacation travel and adventure, among others. If the trend continues without any ‘interruptions’, the industry will witness good recovery in FY 2023, added Shetty.
According to FHRAI, in FY21, the hotel industry incurred losses of more than `1.30 lakh crore ($ 17.65 billion) in revenue while rating agency ICRA has estimated aviation industry’s losses at `42,000 crore in the last two financial years (FY21 and FY22). Other pockets of the tourism sector too witnessed massive losses due to the pandemic, which resulted in nearly 21.5 million job losses, according to the government data.