As India prepares for the historic Sunday presentation of the 2026 Union Budget, the travel and hospitality trade is calling for a decisive shift from piecemeal relief to a holistic policy framework aligned with the ‘Viksit Bharat’ 2047 vision. Represented by apex bodies, industry leaders are urging Finance Minister Nirmala Sitharaman to move beyond viewing tourism as a discretionary sector and instead recognise it as a strategic economic engine. From the long-sought prize of national infrastructure status to the rationalisation of outbound tax frameworks, the trade’s wishlist centers on structural reforms designed to unlock long-term credit, simplify regulatory bottlenecks, and cement India’s position as a globally competitive travel hub.
Reduce the number of NoCs and clearances
KB Kachru, President, Hotel Association of India (HAI) and Chairman – South Asia, Radisson Hotel Group says: “For the upcoming Union Budget, Hotel Association of India (HAI), the national body for Indian hotels, urges policymakers to prioritise sector-specific reforms to drive growth and resilience in the hospitality sector. The hotel sector should be given due recognition for its significant contribution to GDP, jobs and foreign exchange earnings. The key policy interventions are according of infrastructure status and allowing of industry benefits to hotels. This will encourage investments in the sector and unleash the full potential of hotels to generate employment and play the desired role in realising India’s Vision of an Aatmanirbhar Viksit Bharat.
There is a need to further improve the ease of doing business by reducing both- the number and the costs of approvals, NoCs and clearances required to build and operate hotels. A single window clearance mechanism is a provision that requires urgent attention. Re-instating the rewards scheme for FX earnings, higher rate of depreciation for hotels are recommended. Though not related to the budget, the sector also awaits pragmatic GST reforms.”
Strategic budgetary support for destination marketing
Louis D’Souza, Managing Partner, Tamarind Global adds: “As luxury and experiential travel from India continues to gain momentum, the Union Budget can play a pivotal role in shaping both outbound and inbound travel sentiment. On the outbound side, high-spending Indian travellers are increasingly investing in curated, design-led experiences, but policies around TCS and forex costs continue to influence booking timelines and destination choices. Easing these financial frictions would boost travel confidence and encourage travellers to upgrade experiences rather than compromise on quality. Equally important is the opportunity to strengthen India’s inbound tourism narrative. With global travellers seeking authentic, immersive journeys, India’s rich cultural heritage, wellness offerings, luxury hospitality, and emerging experiential circuits are uniquely positioned to attract high-value inbound travellers. Strategic budgetary support for destination marketing, infrastructure upgrades, simplified visa processes, and enhanced connectivity can significantly elevate India’s appeal as a premium travel destination. A forward-looking budget that balances international mobility with strong inbound promotion will not only drive foreign exchange earnings but also create employment across tourism ecosystems. By supporting innovation, storytelling, and seamless travel experiences, the Budget can position India as both a confident outbound market and a compelling inbound destination for discerning global travellers”
Budget should help scale the ‘Heal in India’ initiative
Ishaan Dodhiwala, Co-founder, Medijourn Solutions Private Limited says: “The medical tourism sector expects the Union Budget 2026–27 to respond to the growing global demand for India’s ‘Heal in India’ initiative, as international patients increasingly seek affordable, high quality and outcome driven healthcare.
We expect the government to allocate a specific budget to promote ‘Heal in India’ initiative in the priority markets like Africa, middle east, SAARC and other emerging markets to promote medical tourism to India. Besides we expect specific measures to ease medical visa processes, support internationally accredited hospitals, and expand quality healthcare facilities into Tier II and Tier III cities.
As demand for complex procedures and treatments such as cardiology, oncology, orthopaedics and fertility care continues to rise, expectations also include policies that attract foreign capital and strategic partnerships, along with rationalisation of import duties on advanced medical equipment and incentives for digital health and AI enabled diagnostics.
Overall, the sector expects the Union Budget 2026–27 to scale the Heal in India initiative into a globally competitive medical value travel framework by combining affordability, clinical excellence and sustained global investment.”
Help India build globally competitive travel brands
Aviral Gupta, CEO at Zo World and Zostel, says: "As India prepares for Union Budget 2026, tourism must be recognised as a strategic economic engine rather than a discretionary sector. The next phase of growth will come from strengthening infrastructure in Tier 2 and Tier 3 destinations, improving last-mile connectivity, and supporting affordable, organised accommodation that enables longer stays and higher spending. Targeted incentives for experiential travel, skilling of local communities, and simplified regulatory frameworks for hospitality-led MSMEs can unlock significant employment while helping India build globally competitive travel brands rooted in local culture."
Better route viability can help airlines add capacity
Sandeep Arora, Director, Brightsun Travel, India adds: “With Indians travelling more often and more globally, this Union Budget can significantly improve the economics of travel for Indian consumers and businesses alike. Outbound travel from India has already crossed pre pandemic levels with over three crore Indians travelling abroad annually while inbound interest in India continues to rebuild steadily.
The biggest wins can come from reducing friction through stronger support for air connectivity, smoother visa processes and more flexible bilateral air service frameworks, factors that directly shape both outbound demand and inbound arrivals. India has already expanded digital visa access to over 160 countries and strengthened regional connectivity, which shows that policy-led momentum is possible when processes are simplified.
What the industry now needs is alignment. Better route viability can help airlines add capacity where demand is already visible while value led outbound travel means even small cost or process efficiencies can meaningfully impact booking decisions. Across leisure VFR and student travel segments, intent is strong but conversion still depends on affordability and ease.
India is poised for a future ready travel ecosystem where existing gains in digital access and connectivity translate into faster conversions, higher volumes and more predictable growth across inbound and outbound travel.”
Targeted travel incentives needed
Shikhar Aggarwal, Joint Managing Director, BLS International for your editorial consideration says: “India’s travel and tourism ecosystem has benefited significantly from the Government’s progressive policy outlook towards global mobility and ease of travel. We hope the government maintains this positive outlook.
In addition, continued policy support through the upcoming Union Budget - particularly through certain measures to increase the disposable income, as well as targeted travel incentives - would encourage people to spend more on both domestic and international travel, boosting the overall tourism industry. Furthermore, a review of the current foreign exchange limits and taxes on forex transactions would further support this momentum by easing cash-flow pressures for travellers and service providers. Together, such measures can unlock long-term economic value and contribute meaningfully to the vision of a Viksit Bharat."
Budget should also support green and energy-efficient hotels through targeted incentives
Surendra Kumar Jaiswal, President, Federation of Hotel & Restaurant Associations of India (FHRAI). Adds: “Ahead of the Union Budget 2026–27, the hospitality sector is looking for practical policy support to sustain growth and strengthen tourism-led development. The decision to extend infrastructure status to hotels in 50 select tourist destinations is a welcome step, and the industry hopes this support is expanded across India to unlock its full potential. Granting infrastructure status to hotels nationwide will help unlock long-term, affordable financing, especially for projects in Tier II and Tier III destinations, heritage towns, and emerging tourist centres. Tax incentives for new hotels and higher depreciation rates can encourage fresh investments and timely up gradation of assets, improving overall service quality. The Budget should also support green and energy-efficient hotels through targeted incentives, helping the industry adopt sustainable practices while managing costs. Ease of doing business measures on simplifying approvals and licensing through single-window clearances, remains crucial. GST rationalisation will improve affordability and competitiveness. In addition, stronger marketing and promotion of Indian destinations , along with better last-mile and air connectivity , can help spread tourism more evenly and support inclusive economic growth across regions.
Better roads, improved rail and air connectivity
Elton Rodrigues, Director, HostMyTrips says: “As the Union Budget 2026 approaches, the travel and tourism sector looks forward to policies that can further strengthen domestic tourism in India. One of the key areas that needs attention is tourism infrastructure development. Better roads, improved rail and air connectivity, and enhanced facilities at tourist destinations can make travel easier and more affordable for Indian travellers.
Another important expectation from the Budget is greater clarity on GST rules for hotel room tariffs, especially since pricing often fluctuates based on demand and seasonality. Clear and practical guidelines will help reduce confusion for both hotels and travel platforms, ensure fair taxation, and allow businesses to adopt flexible pricing without compliance challenges.
With focused investments in infrastructure and simplified GST regulations, the government can create a more supportive environment for the tourism industry.”
Grant ‘Industry Status’ to the tourism sector
Vishal Suri, Managing Director & CEO, SOTC Travel Limited, says: “The Union Budget 2026 is a chance to strengthen India’s tourism foundations and accelerate growth. Our key recommendations are: GST Procedural Reforms: While GST 2.0 was a welcome and major reform, it had largely confined itself to rate rationalisation. It is now time to implement an option for Centralised Registration, seamless single returns and reporting across all states and procedural simplification to achieve a truly ‘Good and Simple Tax’ system. Flat 1% TCS: Replace the complex multi-tier structure with high tax rates (5%/20%) with a universal 1% rate. This ensures a clear audit trail of information to the tax department and enforcement authority, while avoiding needless cash/liquidity blockage at travellers’ end. Industry Status: Grant ‘Industry Status’ to the tourism sector to unlock its potential and facilitate growth.”
Policy support for niche segments
Mahesh Iyer, Managing Director & Chief Executive Officer, Thomas Cook (India) Limited, adds: “As India’s Travel & Tourism sector continues to drive economic growth, the Union Budget 2026 presents a key opportunity to unlock its full potential. Granting industry status would provide access to affordable financing, lower interest rates, and institutional credit—particularly for MSMEs that form the backbone of the sector. Investments in infrastructure across under-served regions, spiritual destinations, and Tier II/III cities -combined with a single-window clearance system for hospitality projects— will serve to accelerate development.
To strengthen inbound tourism, policy support for niche segments such as medical, sustainable, and MICE tourism with focus on incentives and skill development programs; review of visa policies (faster e-visa processing, expanded e-visa categories, targeted visa-on-arrival schemes), and enhanced allocation for global marketing campaigns like Incredible India will be critical.
Continued government support for digital public infrastructure and potential incentives for adopting new technologies like Al and blockchain in the travel & financial services to further improve operational efficiency and elevate the traveller experience.
The industry stands ready to partner with the government to make India a truly global tourism hub.”
Need for modern, airport-style bus terminals
Manish Rathi, Co-founder & CEO, IntrCity SmartBus and RailYatri says: "As we look toward the 2026 Union Budget, India’s intercity mobility ecosystem is at an inflection point. Over the past year, the industry has seen growing passenger preference for organised, reliable and experience-led bus travel - especially on medium and long-distance routes. While continued investment in highways remains critical, the next phase of growth must focus on passenger infrastructure and operational efficiency.
Industry-wide, there is a strong consensus on the need for modern, airport-style bus terminals along key national corridors- integrated hubs designed with safe and controlled boarding zones, enhanced security measures, clean restrooms, and quality food facilities. Such infrastructure significantly improves passenger safety and overall travel experience, while also strengthening the viability of shared mobility as a reliable and credible alternative to private vehicles.
With the right fiscal incentives and public-private collaboration, Budget 2026 can accelerate India’s transition to a more sustainable, organised and future-ready intercity mobility ecosystem."
Seamless multimodal connectivity needed
On railways he adds: "The railways have demonstrated strong execution momentum over the past year, with visible progress across safety upgrades, capacity enhancement, infrastructure modernisation and passenger-focused improvements. This reinforces confidence that large-scale transport investments can be delivered efficiently when backed by clear intent and sustained funding.
As we look ahead to the 2026 Union Budget, the opportunity lies in building on this foundation by prioritising integration and experience. From an industry standpoint, the next phase of railway growth should focus on seamless multimodal connectivity - where trains, intercity buses and urban transit systems work together to enable predictable, end-to-end journeys for passengers. Continued emphasis on station modernisation, first- and last-mile connectivity, and digitally connected transport hubs will be critical in unlocking the full potential of rail travel."
Need to rationalise the tax treatment across international spending instruments
Gagan Malhotra, Chief Operating Officer, BookMyForex adds: “The government’s decision to raise the LRS TCS threshold to ₹10 lakh has meaningfully reduced the upfront tax burden on outbound remittances.
However, there remains a need to rationalise the tax treatment across international spending instruments. Forex cards, which are purpose-built for overseas travel and offer transparent, pre-loaded exchange rates, continue to attract TCS beyond the threshold, while international credit card spends remain outside the TCS ambit. This creates an uneven playing field between instruments used for the same purpose and often nudges consumers towards opaque pricing structures with hidden markups.
While TCS is adjustable at the time of filing returns, the upfront cash outflow continues to impact travellers’ liquidity. As outbound travel from India continues to grow, a harmonised and clearly defined TCS framework across international payment instruments would promote transparency, simplify compliance, and ensure fair treatment for Indian travellers”.
Balanced tax rates on processed traditional foods
On FMCG & F&B, Ishita Malpani, Managing Director, Amruta Tea adds: “"Ahead of Budget 2026, the food-tech industry is looking for GST simplification and more balanced tax rates on processed traditional foods to ease pressure on MSMEs and bring unorganised players into the formal economy. Increased spending on cold-chain infrastructure, along with steps to improve household purchasing power, can help drive demand across categories. In line with Atmanirbhar Bharat, targeted support for food-tech automation and smoother access to credit will be critical for enabling homegrown brands to scale and establish India as a global centre for preserved traditional foods."
Continued investment in supply chain modernisation and logistics
Sanket S, Founder at Scandalous Foods adds: "As the FMCG sector navigates a shifting consumption landscape, we look to the Union Budget 2026 to catalyse renewed demand across both urban and rural markets. Targeted fiscal support that enhances disposable incomes through tax reforms and clarity in GST implementation will be crucial for stimulating consumer spending and improving affordability. Continued investment in rural infrastructure, supply chain modernisation and logistics will not only expand market reach but also strengthen the backbone of India’s consumption story. Additionally, measures that reduce the compliance burden and foster ease of doing business will empower homegrown brands to innovate and scale. We are optimistic that the Union Budget 2026 will reinforce growth continuity, support sustainable consumption and unlock meaningful opportunities for the FMCG ecosystem"
Clear and consistent guidelines around bundled services
Vinod Kumar Sah, CTO and Co-founder at CoTrav, says: "With the Union imminent, organisations operating in the corporate travel/events space are eagerly awaiting a simpler system of GST Input Credits. At present, it often happens that GST payments made to hotels, transportation partners, and various other service providers tend to get withheld for a considerably long period of time due to certain bottlenecks in processes.
There is also a need to acknowledge and support businesses that follow proper GST and TDS compliance, maintain transparent invoicing, and run audit-ready financial systems. These companies should be encouraged through process-level incentives instead of being burdened with additional complexity. Clear and consistent guidelines around bundled services and multi-vendor billing, which are core to corporate travel and events, would go a long way in reducing confusion and creating a smoother, more compliance-friendly environment for the sector."
EV adoption and cleaner fuel technologies
Manoj Soni, CEO, YoloBus and Easy Green Mobility says: “As India enters the next phase of economic growth, the Union Budget presents a critical opportunity to strengthen intercity public transport systems that millions of Indians depend on every day. Increased allocations towards road infrastructure, technology-enabled smart bus terminals, and a robust digital ticketing ecosystem can significantly enhance safety, efficiency, and the overall passenger experience in intercity bus travel. At the same time, policy support for EV adoption and cleaner fuel technologies in the intercity bus segment—through targeted incentives, charging infrastructure development, and improved access to financing—can accelerate the transition to sustainable mobility. Fleet modernisation powered by electric and low-emission buses will help operators reduce long-term operating costs while also lowering carbon emissions. A strong focus on green intercity transport will ensure affordable, reliable, and environmentally responsible mobility for nearly 50 million passengers who rely on buses as their primary mode of intercity travel, while supporting India’s broader climate and net-zero commitments.”
Simplifying licensing through single-window clearances
Richa Adhia, Managing Director, Eight Continents Hotels & Resorts adds: “As India positions itself as a global tourism and hospitality hub, Budget 2026 presents an opportunity to unlock the sector’s next phase of growth. We are looking for clarity on GST rationalisation for hotels, particularly mid-scale and experiential properties, along with the granting of infrastructure status to enable access to long-term, lower-cost financing. Simplifying licensing through single-window clearances and faster project approvals will significantly improve ease of doing business. A continued focus on visa facilitation and destination development can further strengthen India’s journey towards becoming a $1 trillion tourism economy by 2047, while driving employment generation and foreign exchange across established and emerging destinations. A forward-looking Budget can firmly position hospitality as a key pillar of India’s economic and tourism-led growth story.”
Heritage-sensitive development
Amrita Gupta, Director of Manglam Group and CEO of Manglam Spa and Resorts adds: “The coming year presents an important opportunity for India’s hospitality sector to scale sustainably while deepening its contribution to tourism-led economic growth. Entering 2026, demand is being driven by experiential travel, destination weddings and wellness-led stays, creating the need for policy support that encourages long-term, quality-led investment. Reforms such as granting tourism industry status, rationalising GST and improving access to infrastructure and green financing can meaningfully strengthen the sector. For destinations like Jaipur, targeted budgetary support for tourism infrastructure, heritage-sensitive development and sustainable hospitality projects will help enhance global competitiveness while preserving cultural identity and driving inclusive growth.”
Frameworks need to recognise cultural hospitality as a stable, employment-generating sector
Vikas Narula, Co-Founder, Depot48 says: “From the perspective of a cultural venue, hospitality is not just about food and footfall, it is about sustaining spaces where music, communities, and local economies intersect. Venues like ours invest year-round in artists, technicians, service staff, and neighbourhood ecosystems, yet policy still treats us as episodic consumption rather than long-term urban infrastructure. Budget 2026 is an opportunity to recalibrate that lens by creating regulatory and financial frameworks that recognise cultural hospitality as a stable, employment-generating sector that needs predictability more than incentives. When taxation, licensing, and access to capital are designed for continuity rather than churn, venues can invest more confidently in people, programming, and safer, more inclusive public spaces that contribute directly to tourism and city life.”
Rationalisation of GST rates
Balaji M, CEO of Clarks Exotica Convention Resort and Spa says: “As we approach the Union Budget, the hospitality sector is hopeful for measures that formally recognise hospitality and tourism as a priority sector, given its significant contribution to employment generation, infrastructure development, and economic growth. Large-format resorts and convention-led destinations like Clarks Exotica Convention Resort & Spa play a vital role in driving business travel, MICE tourism, weddings, and leisure stays, particularly in destinations located close to major urban centres.
One of the key expectations from the upcoming Budget is rationalisation of GST rates for hospitality services. A simplified and more uniform tax structure would help the sector remain competitive, boost demand, and encourage both domestic and international travellers. Granting industry status or priority sector recognition to hospitality would further enable easier access to financing, support long-term investments, and strengthen operational sustainability. Additionally, reintroducing or extending input tax credit benefits for hotels and convention properties could significantly ease cost pressures.
Infrastructure development continues to be a crucial focus area. Sustained investment in road connectivity, airports, and last-mile transport will greatly benefit resort destinations on the outskirts of major cities, improving accessibility for corporate events and leisure travellers. Enhanced focus on convention and exhibition infrastructure would also support India’s growing ambition to position itself as a global MICE destination.
Policy support for sustainability initiatives, including incentives for energy-efficient operations, water conservation, and waste management, would further encourage responsible growth across the sector.
Finally, skilling and workforce development remain essential. Continued support for hospitality training and talent development will help address manpower challenges while elevating service standards.
Overall, we remain optimistic that the forthcoming Budget will adopt a balanced approach, enabling the hospitality sector to grow sustainably while contributing meaningfully to India’s tourism and economic vision.”
Insurance coverage for long- and short-term assisted living
Ishaan Khanna, CEO, Antara Assisted Care Services, on behalf of Antara Senior Care adds: “We are seeing growing investor interest in senior-friendly healthcare and assisted living infrastructure, reflecting the recognition of India’s demographic shift and changing family structures. However, capital alone cannot build a holistic, integrated care ecosystem that is both scalable and sustainable. This momentum would be best supported if the Budget backed it with comprehensive policy provisions, particularly around insurance coverage for long- and short-term assisted living, and at-home care. This represents a critical affordability gap for seniors and their families, for a service that is increasingly becoming a wellbeing necessity.
The second big unlock would come from announcements supporting large-scale training of non-medical care professionals in geriatrics, the establishment of standardised norms for assisted care, and formal recognition of caregiving as a skilled profession. As demand for senior care rises, India has a timely opportunity to move from informal, fragmented solutions to a regulated, high-quality care ecosystem that delivers dignity, safety, and continuity of care for seniors.”
Improved forex policies and incentives for international travel-linked services
Leena Jhugroo, Managing Director, Travel Lounge Leisure & Tours Ltd, adds: "As India’s outbound travel market matures, the Union Budget presents an opportunity to unlock sustained long-haul leisure growth. A key expectation from the industry is rationalisation of TCS on overseas tour packages and forex spends, which continues to impact travel affordability and decision-making for Indian consumers. While demand for experiential and premium travel remains strong, especially among honeymooners and high-net-worth travellers, cost sensitivities can delay or dilute travel plans. For island destinations like Mauritius, which are positioned around romance, luxury, wellness, and MICE, easing outbound travel costs would significantly boost bookings. Improved forex policies and incentives for international travel-linked services would further encourage longer stays and higher spends. With Indian travellers increasingly seeking bespoke, slow-travel experiences over short holidays, supportive policy measures can strengthen India’s position as a key source market for island economies and help destinations like Mauritius sustain year-round demand across leisure and corporate segments.”
Industry status for tourism and hospitality
Hari Ganapathy, Co‑Founder, Pickyourtrail adds: “As we head into Union Budget 2026, travel and tourism are at a genuine inflection point. Demand is clearly back, but infrastructure and connectivity will decide whether this growth compounds or plateaus.
Aviation capacity is expanding rapidly, but that momentum needs to be matched with faster airport expansion, stronger regional connectivity, and smoother aviation infrastructure to unlock its full impact. Just as important is last-mile integration—connecting airports seamlessly with rail and road networks—because that’s where the real multiplier effect lies.
Beyond connectivity, the industry needs structural support. Industry status for tourism and hospitality, easier access to long-term financing, and continued investment in destination development would go a long way in improving India’s global competitiveness as a travel market.
Simplifying tax structures like GST and incentivising skill development are also critical, especially as domestic travel remains strong and international travel continues its gradual recovery. If Budget 2026 focuses on infrastructure, financing, and execution, it won’t just support growth—it will help build a more resilient, globally relevant travel ecosystem.”
Policy alignment between Central and State authorities
Jai Sreedhar, Joint Managing Director & CEO, Rosetta Hospitality says: “The hospitality and tourism sector remains one of India’s most labour-intensive and strategically important industries, with significant potential to drive employment, regional development, and foreign exchange earnings. As the sector continues to gain momentum across both domestic and international travel, there is a strong case for structural reforms in Budget 2026.
Recent rationalisation within the GST framework has been a welcome step, but several challenges persist, particularly the denial of input-tax credit across certain GST rate bands, at a time when input costs continue to rise. Greater clarity and a more workable credit mechanism would materially improve operational efficiency and financial viability for hotels and resorts across the country.
Another priority for the sector is the long-standing request for recognition as an industry or infrastructure category. Hospitality assets have inherently long gestation periods, and enabling banks and financial institutions to offer more customised, longer-tenor loan products would go a long way in bridging the demand-supply gap for quality tourism infrastructure.
Policy alignment between Central and State authorities, streamlined approvals, and a more coordinated regulatory environment will further strengthen investor confidence and support sustainable expansion.
We remain optimistic that Budget 2026 will build on the sector’s positive momentum and contribute meaningfully to India’s emergence as a premier global tourism destination.”
In a follow up article, we will deliberate upon how many of these expectations are actually met by the Union Budget 2026!
