Visa Inc.

🇺🇸New York Stock Exchange
Back to all articles
Somewhat Bearish -40

Next tourism leap needs easing visa

📈 India has expanded its e-visa regime to over 160 countries but argues incremental reforms are no longer sufficient for the next tourism growth phase.

✈️ Global evidence from the World Tourism Organisation indicates visa facilitation can increase international tourist arrivals by 5% to 25%.

🌍 International travel rebounded to over 1.4 billion arrivals in 2024, signaling a return to pre-pandemic mobility levels.

📉 Despite global trends, India attracts only 20-22 million foreign tourist arrivals annually with modest foreign exchange earnings compared to leaders.

🏆 The World Economic Forum's Travel & Tourism Development Index 2024 ranks India at 39th due to gaps in openness and infrastructure.

🛂 Southeast Asian rivals like Thailand, Indonesia, and Vietnam use aggressive visa liberalisation paired with strong branding and seamless infrastructure.

💰 Countries such as Thailand attract over 35-40 million tourists annually by combining ease of entry with high visitor spending and length of stay.

🇮🇳 India's current e-visa system is limited by restricted visa-free access, short validity periods, and lack of multi-entry flexibility.

📊 Rajasthan tourism contributes nearly 12% to the state's GDP but relies heavily on domestic tourists while international visitors account for only ~1.5 to 2 million annually.

💵 Foreign tourists typically spend two to four times more per visit than domestic travellers, driving higher "tourism yield" and economic returns.

🎯 Visa liberalisation is critical for attracting high-value, long-haul tourists who prioritize convenience and predictability for maximum revenue generation.

🧠 Concerns about security from easy entry can be managed through AI-enabled monitoring rather than restricting access.

🚀 Even a modest 10-15% increase in foreign tourist arrivals could result in substantial foreign exchange gains when combined with improved in-country experiences.

🏛️ India's tourism strategy has reached an inflection point requiring a shift towards expanding visa-free regimes for key markets and longer-duration visas.

🌐 Destinations that combine accessibility with superior experience will lead the next phase of global tourism growth and competition.

Bullish Signals
  • India has already made meaningful progress in expanding its e-visa regime to over 160 countries, significantly reducing barriers for international travellers.
  • Global evidence indicates that visa facilitation can increase international tourist arrivals by 5 to 25%, particularly in emerging markets like India.
  • International travel has rebounded to over 1.4 billion arrivals in 2024, signalling a return to pre-pandemic levels of mobility which provides a favorable environment for growth.
  • Rajasthan alone contributes nearly 12% to the state's GDP through tourism, highlighting the immense job creation potential and economic centrality of the sector.
  • Foreign tourists typically spend two to four times more per visit than domestic travellers, offering substantial upside potential for revenue if high-value segments are targeted.
  • The Rajasthan Tourism Department reports tens of millions of tourists arrive annually, indicating a strong existing base with room for international expansion.
  • Even a modest increase in high-value international tourists could significantly enhance overall tourism revenue and foreign exchange earnings for the country.
  • India possesses the cultural depth, geographic diversity, and institutional capacity to become a global tourism leader if policy shifts are adopted.
Risk Factors
  • India's tourism trajectory underperforms relative to global leaders and its own potential, attracting only 20-22 million foreign tourist arrivals (FTAs) annually.
  • India ranked 39th in the Travel & Tourism Development Index 2024, indicating significant structural gaps in international openness, visitor services, and tourism infrastructure.
  • Competition from Southeast Asian rivals like Thailand (35-40 million FTAs), Indonesia, and Vietnam is intensifying through aggressive visa liberalisation policies that India has not matched.
  • India's e-visa system retains restrictive features such as limited multi-entry flexibility and shorter validity periods, which deter high-spending, long-haul tourists who prioritize convenience.
  • International tourism constitutes a small fraction of India's total tourism volume, with international visitors accounting for only an estimated 1.5 to 2 million visits in states like Rajasthan despite the destination's global appeal.
  • Over-reliance on domestic volumes leaves India vulnerable as it fails to capture the higher revenue and longer stays generated by foreign tourists, who typically spend two to four times more per visit.
  • Despite expanding the e-visa regime to over 160 countries, incremental reforms are insufficient to address the need for deepening visa liberalisation to attract higher-value segments.
  • The current policy approach risks falling behind in the next phase of global tourism growth where destinations combining accessibility with experience will lead market expansion.
Full Analysis
India stands at a critical juncture in its tourism sector, requiring a strategic pivot from incremental e-visa improvements to deepening visa liberalization to capture higher economic value. Despite expanding e-visa access to over 160 countries and recovering international arrivals to 1.4 billion globally in 2024, India attracts only 20-22 million foreign tourists annually, generating $28-35 billion in forex, which remains modest compared to global leaders like Thailand. The Travel & Tourism Development Index 2024 places India at 39th, highlighting structural gaps in international openness and visitor services that hinder competitiveness despite progress in accessibility. A key driver for this underperformance is the contrast with Southeast Asian peers such as Thailand, Indonesia, and Vietnam, which have adopted aggressive visa-free or visa-on-arrival policies integrated with robust branding and infrastructure. Thailand, for instance, attracts 35-40 million tourists annually with higher average spending and length of stay per visitor. Indian policy remains transitional with restricted visa-free access and shorter validity periods, limiting the influx of high-value, long-haul tourists who prioritize convenience and predictability. This results in tourism growth heavily reliant on domestic volumes rather than international value, where data indicates foreign tourists spend two to four times more per visit than domestic travelers. Experts from CUTS International argue that India must shift toward maximizing tourism yield by expanding visa-free or visa-on-arrival regimes for key markets and introducing longer-duration multi-entry visas aligned with high-value segments. While concerns exist regarding security risks, the authors suggest leveraging AI-enabled monitoring to mitigate these issues without compromising liberalization efforts. Even a modest 10-15% increase in foreign tourist arrivals through such reforms could yield substantial forex gains, emphasizing that visa policy is no longer just procedural but a strategic economic tool essential for realizing India's job potential and cultural diversity as global destinations compete more intensely.