Indian outbound travel will be ‘the story' of the next decade, says Hilton executive

Indian travelers spent $34.2 billion on outbound travel in 2023, according to the World Travel & Tourism Council.

But the current level of Indian travel is "minuscule" compared with what's to come, Alan Watts, Hilton's Asia-Pacific president, told "Squawk Box Asia" Monday.

"The story for India is before us," he said. "India outbound will be the story of the next decade."

By 2034, Indian travelers' outbound spend is projected to more than double to $76.8 billion, according to the World Travel & Tourism Council's Economic Impact 2024 report — which would make the country the seventh-largest travel spenders in the world, up from 12th in 2023.

"When you think of India, it has the characteristics of China, which is the second largest lodging market in the world," said Watts. It has "1.4 billion people, a young population, historically strong GDP growth. But the infrastructure … is only just getting built in India now."

India is investing heavily in infrastructure to build and improve its roads, high-speed trains and airports, in a building spree to double its economy to $7 trillion by 2030 and turn India into a developed nation by 2047.

India currently has the third most air passengers in the world, after the United States and China, according to Airports Council International. It's expected to add 960 million new passengers by 2042, it said.  

On Monday, Air India, the country's flag carrier, confirmed an order for 100 Airbus aircraft — 10 A350 and 90 A320neo jets — on top of a then-record-breaking order for 470 Airbus and Boeing aircraft in 2023.

That follows a record-breaking order for 500 Airbus jets by India's low-cost carrier Indigo in 2023, which are scheduled to be delivered between 2030 and 2035, according to Indigo.

As for whether India will be the "new China" in the global travel industry, Watts said it "certainly seems to have the right characteristics for it, and that's why the industry has been so bullish."

He also noted that outbound travel is growing faster in India than it did in China.

Hotel expansion

Global hospitality companies are also preparing for an explosion of new travelers, as millions are projected to move into Indian's middle class in the coming years.

On Nov. 19, Hilton announced a deal to open 150 Spark by Hilton hotels in India, a "premium economy" brand launched in the United States in 2023.

In discussing the potential for branded hotel expansion in India, Watts confirmed that India has around the same number of branded hotels as Las Vegas.

But now it has more attention from outside investors.

"What's different about India this time is its foreign direct investment. In fact, some of the big capital players are in India, and that's new," said Watts.

Marriott, IHG, Hyatt and Wyndham are also moving to capture growing travel interest in India, with Marriott announcing plans to have 250 hotels in the subcontinent by 2025.

Courting Indian travelers

As outbound travel from China remains muted, more countries are courting Indian travelers through new visa-free agreements, direct flights and ad campaigns.

Australia's "Howzat for a holiday?" campaign, launched in November during the Australia-India Test cricket series, is projected to reach 50 million people, according to its minister for trade and tourism.

The number of Indian travelers to Australia is expected to double by 2028, according to a press release announcing the campaign launch.