India's $38B Travel Boom: How Digital Startups, Experiential Tourism, Credit Card Economy, and Cultural Events Are Fueling a 6.1% Growth Surge "Indians are more informed and discerning than ever before and seek holistic experiences during their travel," Sanjay Khanna, CEO and Country Manager at American Express Banking Corp India

India's travel and tourism sector is undergoing a remarkable transformation, emerging as one of the most dynamic contributors to Indian economy. According to World Travel and Tourism Council CEO Julia Simpson, the sector currently contributes 7 per cent to India's GDP and is well on its way to reaching the global average of 10 per cent.

In terms of market size, India's travel and tourism industry reached USD 22.47 billion in 2024 and is projected to grow steadily, hitting USD 38.12 billion by 2033. This growth is driven by a healthy Compound Annual Growth Rate (CAGR) of 6.10 per cent between 2025 and 2033, as per a report by IMARC Group.

Digital influence, startup ecosystem and experiential travel

Fueling this surge is the ease of travel planning enabled by India's digital-first travel ecosystem. Startups like MakeMyTrip, EaseMyTrip, and Yatra have democratised travel access by putting information, bookings, and deals at consumers' fingertips. As a result, India witnessed a 21 per cent year-on-year increase in accommodation searches by international travelers on Agoda's platform between 2023 and 2024.

This growing curiosity reflects not just India's expanding presence on the global travel map but also the pivotal role of technology in making travel more accessible and efficient.

The 2025 Global Travel Trends Report by American Express Travel highlights that 77 per cent of global travelers plan to take more or the same number of international trips in 2025 compared to the previous year. Among younger generations, including Millennials and Gen Z, there is an increasing appetite for experiential travel. Nearly 70 per cent are drawn to journeys where the mode of travel—such as luxury rail rides or cruises—matters just as much as the destination itself. This signals a broader evolution in travel preferences, with emotional and aspirational value driving trip choices.

Government push

Recognising the economic and cultural importance of tourism, the Indian government has launched a series of initiatives aimed at enhancing infrastructure, simplifying visa processes, and creating a traveler-friendly environment. Speaking at the India Travel & Tourism Sustainability Conclave 2025, Simpson remarked that India's travel sector presents an extraordinary opportunity and is on track for a 7 per cent growth rate. She also highlighted India's impressive commitment to sustainability, noting a 13 per cent decline in carbon intensity—outpacing the global average.

Suman Billa, Additional Secretary at the Ministry of Tourism, emphasised the urgent need to balance rapid growth with sustainability. He pointed out, "Today, demand is outstripping supply. Most of our tourist destinations are getting overcrowded, are getting filled up to capacity." To address this, the government introduced two major initiatives in the 2024 budget: a performance-based reward system for destinations excelling in sustainability, cleanliness, hygiene, and safety, and the development of 50 new tourist destinations to decongest high-traffic areas.

Billa explained that informal discussions have already begun, stating clearly, "Informal consultations have started. But what we are now making are the guidelines... this year hopefully we think at least the first set of the 50 destinations should be identified and good to go."

Evolving traveler behaviors

In 2025, Indian travelers are placing increasing value on immersive, culturally rich experiences. A striking 92 per cent of Indian tourists now seek unique, one-of-a-kind souvenirs that tell a story—items they can proudly share with family and friends. This growing inclination toward authenticity is closely linked with support for local economies, with 84 per cent of travelers preferring to shop from small businesses during their journeys. Whether it's artisanal coffee from Colombia or handcrafted Italian leather goods, about 81 per cent of Indian travelers prioritise high-quality local products, reflecting a deep appreciation for global craftsmanship.

Additionally, there is a visible shift toward aspirational spending, with half of Indian travelers planning international trips specifically to purchase luxury items or investment pieces. This trend showcases how travel is increasingly tied to lifestyle, with journeys becoming extensions of one's identity and aspirations.

A new cultural economy

Live music and entertainment have emerged as major travel motivators. Around 58 per cent of Indian travelers plan trips—both domestic and international—to attend concerts and performances. This surge in interest has caused flight bookings to spike by 300–350 per cent around major events. In 2025, India's concert calendar is packed with global names like Ed Sheeran, Shawn Mendes, Green Day, and Blackpink. These events are fueling what analysts call the "concert economy," projected to trigger INR 6,000–8,000 crore in consumer spending, with 123 per cent of fans opting for premium concert experiences.

The announcement of these shows alone has led to spending worth INR 1,600–2,000 crore over the past few months. Concerts also deliver broader economic benefits—supporting event planners, hotels, restaurants, and transportation services, while simultaneously contributing to urban development and renewal. Importantly, they serve as platforms for emerging talent, enriching India's creative economy and extending its cultural influence globally.

While entertainment leads in 2025, sports tourism remains a steady contributor to travel demand—36 per cent of Indian travelers are taking domestic trips for sporting events, and 32 per cent are venturing overseas. Cricket remains the top sport of interest, commanding 63 per cent of the share, followed by football at 38 per cent. As global sporting calendars expand, this trend is only expected to grow.

Credit card at play

Despite their aspirations, Indian travelers in 2025 are also proving to be savvy spenders. About 79 per cent are planning to use reward points to cover travel expenses like flights, hotels, and rentals. Moreover, 84 per cent are strategically combining credit card perks with loyalty programs, especially for international travel. Half of them are also linking their credit cards with dining partnerships to maximise daily benefits, demonstrating a clear shift toward informed and financially sound travel planning.

As Sanjay Khanna, CEO and Country Manager at American Express Banking Corp India, put it, "Indians are more informed and discerning than ever before and seek holistic experiences during their travel." This balanced approach—blending emotional satisfaction with financial responsibility—is helping shape a mature, resilient, and forward-looking travel economy.