India’s business travel sector will expand at a much faster rate than previously expected this year, according to a new report.
In its second BTI Outlook report for India, the Global Business Travel Association (GBTA) projects that India’s total business travel spend will grow 8.6% in 2014 to US$26.2 billion – a significant upgrade from the 2.1% growth predicted in the first outlook report. The industry is then expected to advance another 9.2% in 2015 to US$28.6bn.
The upward revision follows the India’s GDP growth of 4.6% and 5.7% in the first and second quarters of 2014 – the country’s best performance since 2011. GBTA also highlighted a 13% rise in consumer spending in Q1 as being a major indication of the country’s improved performance.
“Growth in business travel spending in India over the last 15 years has been nothing short of remarkable, helping to pace the tremendous performance of the overall Indian economy,” said Welf Ebeling, GBTA’s vice president of operations for Asia Pacific.
“Renewed optimism for the Indian economy on the heels of new pro-business leadership is great news for the continued future growth of business travel spending in the region.”
Domestic business travel spending is now expected to grow 9% in 2014, a significant upgrade from the previous forecast of 2.2%. And this growth will continue in 2015, when a 9.2% rise is predicted.
The report noted however, that international outbound travel from India has been “extremely volatile” over the last few years. As such, it predicts that spending in this sector will grow only 4.8% in 2014, before accelerating to 9.7% in 2015.
The GTBA also said that infrastructure, particularly a lack of quality hotel rooms for business travellers, remains a challenge for India. It noted however, that the new government appears to be a more “business-friendly administration”.