Gen Z ignites India’s travel revival amid global uncertainty

India’s travel industry is expected to witness a boost this festive season, driven largely by Gen Z travellers and a surge in spiritual tourism, even as overall growth has moderated due to recent disruptions, according to Manjari Singhal, Chief Growth and Business Officer of Cleartrip.

Singhal said the industry began the year on a strong note, with January, February, and March recording unprecedented growth in terms of yields, marking an excellent period for both domestic flights and hotel bookings.

However, the momentum slowed in June and July following geopolitical tensions and the Air India crash, resulting in a flattening of domestic air travel numbers and a decline in yields over the past four months. Despite this, Singhal noted a reversal in demand since the second half of August, suggesting that overall growth for the year is likely to remain muted but stable.

The uptick in bookings is being primarily driven by younger travellers and interest in spiritual tourism. Singhal highlighted that spiritual destinations are witnessing significant demand from Millennials and Gen Z, who are also driving the broader leisure segment. She further added that the recent changes in GST are expected to positively impact hotel bookings during the festive season.

On potential government measures to further boost the sector, Singhal emphasised the need for continued policy support. She suggested optimisations that could reduce airport cost structures, which would allow airlines to expand capacity and improve overall travel affordability.

Singhal also highlighted robust demand in outbound travel, despite geopolitical impacts such as the Ukraine-Russia conflict and tensions in the Middle East affecting traveller sentiment over the past three years. Indian travellers, however, have adapted by exploring new international destinations added in the last two years. Countries in Southeast Asia, including Vietnam and Thailand, have seen significant movement from India, reflecting the diversification of outbound tourism.

Cleartrip’s insights indicate that while annual growth has faced headwinds, targeted segments such as Gen Z travellers and spiritual tourism are expected to sustain the industry during the festive season. Continued government-friendly policies and infrastructure optimisations are anticipated to further support recovery and expansion in both domestic and international travel markets.

The travel industry’s performance in the coming months will be closely watched as it balances the effects of earlier disruptions with renewed demand from emerging traveller segments.