Greater access to technology and a booming middle-class are expected to bolster the already rapid growth of online tourism in India, helping it to outperform the overall travel market by a good 6 percentage points to 17.8% in the three years to 2016, according to global research and analytics company Aranca.

In a report, titled Indian Online Travel Industry — Going Places, the company said 41% of gross travel bookings in the country are taking place online and the increasing internet and mobile internet penetration will play a vital role in the online travel market’s growth story.

Another factor aiding the growth will be the country’s burgeoning middle-class, which is becoming increasingly aware of the need for a better work-life balance. “The increasing disposable income of a growing middle-class has led to more families and individuals planning both domestic and international vacations, at least once a year, which will, in turn, fuel the growth of online travel market,” Kunal Doctor, senior research analyst at Aranca, said in the report.

The Indian travel and tourism industry is the second fastest growing market worldwide, following China. While the worldwide travel market is clocking just 4% growth, the travel industry in the country is set to grow at a compounded annual growth rate (CAGR) of 12% to reach $27.5 billion in 2016, it said.

The report notes that the government has taken several progressive steps for the tourism industry in recent times, including introduction of electronic visa scheme (e-tourist visa), formulation of a new tourism policy and creation of tourist circuits based on specific themes.

“Government initiative of introducing e-tourist visa to 113 countries has help boost foreign tourist arrivals to the country,” the report said, adding that the recent depreciation of rupee also aided inbound tourism. “There is more interest in India as travellers save around 5-10% on travel cost on account of the depreciation.” Moreover, the passenger traffic has grown significantly owing to airfare cuts, introduction of new low-cost airlines and improvement in the economy.

Hotel supply in the country remains upbeat. While the rapid increase in supply has affected average daily room rates and occupancy figures, the tourism department has referred to a shortage of around 150,000 rooms in the budget, economy and mid-market segments, it said.

In an effort to attract a wider pool of domestic travellers, brands like AccorHotels, Berggruen Hotels, Carlson Rezidor, The Gateway, Ginger Hotels and InterContinental Hotels are adding inventory in the economy and mid-scale categories.

“However, the online hotel segment in India is rather under penetrated — with only 10% of hotels accepting bookings online while the overall user-base of people seeking information on hotels online was very high,” the report said.

Source: http://timesofindia.indiatimes.com/tech/tech-news/Tech-access-low-airfares-boost-online-tourism/articleshow/49287591.cms