Overseas tour costs have surged 10-15 per cent year-on-year on the back of rise in airfares and hotel rates, but that has not dented the appetite of Indian globe trotters, say travel companies.
"Overseas tours are indeed more expensive this year compared to last year. Several factors have contributed to this increase including rising airfares and higher accommodation costs. These increases are largely due to the resurgence of travel demand, which has led to a surge in bookings and consequently higher prices," said Dhruv Shringi, Co-founder and CEO of Yatra.com.
SOTC Travel's president and country head (holidays), Daniel D'souza, said the average increase in tour prices is in the range of 10-15 per cent.
A tour price includes airfare, hotel charges, ground transport, fees at various attractions, and visa fees. The cost composition varies according to distance and duration. Airfare makes up around 35 per cent of the price of a group tour to a short-haul destination and the rest includes ground expenses. In the case of group tours to long-haul destinations, the proportion of airfare can be around 25 per cent. In the case of customised or individual trips, the share of ground costs (hotels, ground transport, etc.) tends to be higher.
According to SOTC Travel, a 15-day group tour to Europe is priced at ₹3.75 lakh per person this year compared to ₹3.4 lakh last year. Similarly, an eight-day Japan tour is now priced at ₹2.75 lakh per person compared to ₹2.47 lakh last year. A seven-day group tour to Southeast Asia is now priced at ₹1.3 lakh compared to ₹1.2 lakh last year.
Other factors contributing to higher tour prices include an increase in Schengen and New Zealand visit visa fees. Entrance fees to the popular Masai Mara National Reserve in Kenya have nearly tripled from $ 70 to $ 200 for the peak season. Cities in Europe, such as Barcelona and Venice, have levied or increased their taxes on tourists following concerns of "overtourism."
Yet, despite these higher costs more Indians are travelling overseas than before. Over 15 million Indians flew overseas and over 40 per cent of them travelled for leisure between January and June, according to data compiled by the Union Tourism Ministry. The number of Indians travelling in the first six months of 2024 increased by 13.7 per cent over the same period in 2023 and by 12.2 per cent over 2019.
The momentum for overseas travel remains strong in the second half of the year too. "Our forward bookings reflect a healthy demand pipeline of 20 per cent for the upcoming season too. Indian consumers are displaying an increased appetite for travel, with multiple micro trips driving demand in the low season," D'souza said.
Shringi added that Yatra.com is seeing interest and bookings for international travel, indicating a desire among Indians to explore newer destinations.
Indians account for nearly 5 per cent of foreign tourists in Thailand and arrivals in the first six months have exceeded the 2019 level. While South Africa has been attracting Indian tourists for a while, neighbouring Zimbabwe is also marketing itself. Last week, a delegation from Zimbabwe's travel industry visited Mumbai for promotions.
Europe remains a popular destination for meetings, incentives, conferences, and exhibitions for Indian travellers, and factors like air connectivity and ease of visa approvals influence choices. "Many of our partners prefer smaller groups of 100 guests for European tours and are willing to spend more for better experiences that also lean towards more sustainable offerings," said Manpreet Bindra, Meetings and Events Leader for Asia at FCM Travel.