Economic Times 19-January-2017
Mumbai: India is the world’s tenth largest business travel market and is likely to clock the fastest growth in this segment in the next five years. Business travel spending is expected to treble until 2030 from $30 billion in 2015, a report by consultancy KPMG and FCM Travel Solutions said.
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“In 2015, India saw a 15% increase in business travel spending, which will grow by a compound annual growth rate (CAGR) of 12% through 2020 to 6% by 2030. This increase in all possibility will be greater than the increases in business travel growth in the next three largest countries combined, including South Korea, Italy and Brazil. Thirteen years from now (by 2030), India will likely be amongst the top five in business travel spending,” the report said.
The report attributed the growth to “political, economic and demographic factors”. It said macro-economic growth, an evolution in the regulatory environment, increased growth and expansion in industrial activity, coupled with fast digitisation of travel booking tools has and will continue to lead to the growth.
India has in a decade climbed the ranks from one of the world’s twenty largest business travel markets to be among the top ten. In the list compiled from a World Travel and Tourism Council Report, India follows China, US, Germany, Japan, UK, France, South Korea, Italy and Brazil.
List topper China’s business travel market size is $291 billion, close to ten times that of India. India is estimated to overtake Brazil, Italy and South Korea and take seventh place by 2020.
India’s business travel spend is roughly a fourth of its total annual travel expenditure as travellers still spend the bigger chunk on leisure, an executive at KPMG told ET.
About 80% of the business travel transactions are domestic, rest international, FCM managing director Rakshit Desai told ET. Revenuewise, the split is 50:50, he added. About 77% of the total spend is on air travel, the report said.