The Aakhya Weekly #181 | A Longer Itinerary for India’s Tourism Story

Feb 06, 2026

In Focus: The Road Taken, and the Roads Left Behind

The 2026 Budget released last Sunday felt less like a headline-grabbing announcement and more like a measured exercise in continuity and consolidation. Yet woven through it was a clear and consistent focus on tourism, not as a passing mention in the margins of the speech, but as a priority that cut across aviation, healthcare, skills, infrastructure, ecology, and heritage. The clustering of announcements on seaplanes, regional medical hubs, trekking trails, the Purvodaya circuit, big cat diplomacy, and experiential archaeological sites in the finance minister’s address suggested that tourism is now being treated as a serious economic driver within the services sector rather than a secondary concern.

Since 2023, tourism has steadily gained prominence in economic policymaking, with the Finance Minister explicitly naming it as one of the opportunities of ‘Amritkaal’. The scale and diversity of interventions have expanded. What has not kept pace, however, is the institutional ability to convert these plans into consistent outcomes. As a result, the story of tourism policy is less about a lack of vision and more about strong intent colliding with uneven execution.

Why Tourism is Suddenly Central

The pandemic marked a turning point in how governments viewed tourism. Before Covid, India’s policy imagination largely placed tourism in the realm of culture, heritage, and diplomacy. It was important, but rarely treated as a serious engine of growth. The lockdowns changed that perception almost overnight. Airports shut, hotels emptied, guides and drivers lost livelihoods, and local economies dependent on visitors came to a standstill. The crisis revealed how deeply the sector is woven into employment, small businesses, and regional development.

As travel resumed, the economic case for tourism became harder to ignore. According to a June 2025 NITI Aayog report on homestays, India’s travel and tourism sector contributed ₹21.15 lakh crore to the economy in 2024, a 21 per cent increase from 2019. The Economic Survey 2026 reinforces this momentum, estimating that in FY24, tourism contributed 5.22 per cent to GDP, close to pre-pandemic levels, while supporting 8.46 crore direct and indirect jobs, accounting for around 13.3 per cent of total employment. Foreign exchange earnings from tourism also increased to USD 35 billion in 2024, up 8.8 per cent from the previous year. This forms the economic backdrop against which the growing number of tourism announcements must be read.

At the same time, the Survey offers an important caution for the sector. It emphasises that converting tourism potential into sustained economic outcomes depends critically on state and local capacity. Roads and airports can be built centrally, but cleanliness, safety, signage, service quality, and destination management are delivered locally, which is where India’s tourism promise often falters.

What the Budgets since 2023 have tried to do

Since 2023, budgetary interventions have steadily reframed tourism from a collection of scattered projects to a more coordinated, destination-led approach. The Centre has moved beyond a narrow focus on connectivity towards integrated development of key sites, reflected in the 50 challenge-mode destinations, the Vishnupad-Mahabodhi corridors, Rajgir, and Nalanda. This has been accompanied by greater emphasis on Centre-state coordination and public-private partnerships, as well as efforts to link infrastructure to skilling and community participation through initiatives such as ‘Dekho Apna Desh’, the IHMs, and MUDRA loans for homestays. New policy strands have also been added, including eco-tourism under Amrit Dharohar, border tourism under Vibrant Villages, island tourism in Lakshadweep, and medical tourism under “Heal in India”.

What emerges from this steady expansion of initiatives is not a shortage of policy activity, but a recurring pattern of uneven follow-through. The “50 challenge-mode destinations” scheme, first announced in the 2023 Union Budget, which intends to develop 50 top tourism sites in partnership with states through a competitive challenge process, remains in early stages of implementation, with many destinations yet to move beyond planning and identification into visible on-ground development. Even the Draft National Tourism Policy, meant to provide an overarching framework, remains in draft form, highlighting how strategic intent has so far outpaced institutional consolidation.

Structural Problems Beneath the Announcements

Beneath this ambitious policy canvas lie deeper structural constraints that shape tourism outcomes far more than budget speeches. In 2025–26, the Tourism Ministry’s Budget Estimate of ₹2,534.94 crore was revised down to ₹1,304.17 crore, suggesting that a sizeable share of the planned allocation could not be utilised. This figure points to persistent implementation bottlenecks that continue to slow progress on the ground.

These bottlenecks are most visible in basic infrastructure, especially in lesser-known and rural destinations. Even as marquee sites receive investment, many emerging destinations still struggle with unreliable roads, inadequate public toilets, limited drinking water, weak signage, and patchy accommodation options, all of which directly affect visitor experience and discourage longer stays or repeat travel. The Ministry of Tourism’s 2023 sectoral assessment finds that 41 per cent of stakeholders view lack of infrastructure as a key barrier to increasing footfall, underscoring how basic deficits can undermine even well-designed programmes.

When this is layered onto the strain of seasonal tourism during festivals, long weekends, and peak holiday periods, waste management, water supply, and sanitation systems are routinely overwhelmed by visitor surges they were never designed to handle. Beaches, hill stations, and pilgrimage towns often bear the brunt of this pressure, turning what should be vibrant tourist seasons into acute environmental stress points that local administrations struggle to manage sustainably.

The same assessment from the ministry also shows that 49 per cent of stakeholders identify poor local promotion of tourist sites as an even bigger barrier to improving footfall. Marketing thus remains a thin leg of India’s tourism strategy. Overseas tourism promotion stood at ₹31.99 crore in 2024–25, dipped to ₹3.07 crore in the 2025–26 Budget, before being revised upward to ₹43.48 crore later in the year, and then settled at just ₹3.50 crore for 2026–27. At the same time, allocation for domestic promotion dropped from ₹60 crore in the revised 2025–26 estimates to zero in 2026–27, even though domestic travel is clearly expanding. For a brand that calls itself Incredible India, this level of investment in visibility feels minimal, especially when peer destinations are pouring resources into digital and influencer-driven campaigns.

With respect to developing tourism sites, large-scale archaeological projects and corridor-based development have undeniably improved access in many places. However, they have also drawn criticism for altering the character of some sites. Visitor infrastructure is necessary, but it must be carefully balanced so that conservation does not become a casualty of development. Skills remain another weak link, even though they sit at the heart of the tourism experience. The recent initiative to train guides is a welcome step; however, destination management requires much more: capable local officials, professional maintenance teams, standardised service protocols, and stronger links between hospitality institutes and local tourism ecosystems.

Finally, tourism cuts across Urban Development, Environment, Culture, the ASI, Ports, Aviation, state governments, and municipal bodies, making alignment around a single destination plan inherently complex. With so many actors involved, accountability often becomes diffused, even as the Ministry’s own assessment calls for clearer inter-ministerial coordination.

A Fragile Middle Space

India’s tourism ecosystem is now vast, involving state authorities, private players, home stays, tourism operators, hospitality firms, civil society, local communities, heritage bodies, and environmental regulators. Yet, this complexity has not been matched by a clear, integrated roadmap that aligns all these actors around shared goals. This roadmap will have to bring these stakeholders to a common table, with a stronger digital thrust that facilitates real-time visibility. Be it footfalls, infrastructure, safety, or service quality, such assistance helps in planning proactive rather than reactive solutions and experiences that can be crafted more sustainably.

The sector thus occupies a curious middle space that is too important to ignore yet too fragile to deliver to its full potential. The budgets have outlined the vision; what remains is the painstaking work of strengthening the foundations that can sustain it.

A Few Good Reads

Sushant Sareen’s incisive analysis shows how Pakistan’s security establishment is re-framing the Baloch insurgency as a perceived regional geopolitical threat centred on the idea of a “Greater Balochistan.”
C. Raja Mohan argues that India’s patient handling of trade frictions underscores the structural resilience of the bilateral relationship, urging Delhi to move beyond anxiety and leverage strategic convergence to achieve its goals.
Pratap Bhanu Mehta uses the Epstein files to argue that the scandal is not about individual guilt but a stark exposure of how modern elite power operates.
Pieter Haeck examines how Dutch dependence on U.S. tech, exposed by concerns over DigiD and American cloud control, is forcing the Netherlands to rethink digital sovereignty as a national security imperative.
Happymon Jacob argues that the global re-militarisation of middle powers validates India’s long-standing strategy of strategic autonomy, creating new opportunities to partner with like-minded states in a post-alliance world.

Event Watch

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