India’s Inbound Tourism Lags Global Peers, EY–FICCI Calls for GST Cuts and Visa Reforms

India’s tourism sector continues to grow on strong domestic demand, but inbound tourism remains below potential compared to global peers despite the country’s rich cultural and natural diversity, according to an EY India and FICCI report.

The report, “Reimagining Inbound Tourism in India: Trends, Technology and Transformational Opportunities,” released at the Great Indian Travel Bazaar , outlines a roadmap to position India under the “Incredible India 4.0 framework” as a unified, experience-driven global destination.

It notes that domestic tourism continues to drive growth , accounting for the largest share of spending, while international arrivals and foreign exchange earnings remain relatively modest.

Key barriers include fragmented state branding, weak global marketing, lack of experience-based tourism products , pricing concerns, connectivity gaps, and visa-related challenges. India is also viewed as less price-competitive than destinations such as Thailand and Vietnam.

The report proposes policy measures, including a possible reduction in GST on premium hotel rooms from 18% to 9% , to improve affordability and attract high-value foreign travellers. It also stresses easing visa processes and improving travel connectivity.

A major shift highlighted is the global rise of experience-led travel , with tourists seeking immersive journeys around culture, wellness, cuisine, spirituality, heritage, and adventure. The report urges India to move from a collection of destinations to a unified experience economy.

It recommends unified branding, digital transformation, better infrastructure, and stronger service standards, along with targeting premium travellers, MICE tourism, solo travellers, and women travellers.

Tourism contributes around Rs 21 trillion to India’s GDP and supports over 46 million jobs , making it a key economic driver.

Rajasthan Deputy Chief Minister Diya Kumari called the roadmap timely for building an experience-driven ecosystem , while Suman Billa said future growth depends on stronger integration of state tourism offerings into a cohesive national strategy.