Hoteliers must chase Indian tourists if foreign travellers stay away: Oberoi Hotels Chairman

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26 Aug, 2025 12:21

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Foreign guests will likely stay away from India not just this year but the next as well, further straining the hospitality industry, EIH executive chairman PRS Oberoi has told shareholders

EIH is the listed entity of The Oberoi Group that runs hotels under Oberoi and Trident brands.

The travel industry was among the first to be affected by the pandemic and will, in all probability, be the last to recover, Oberoi said in his address to shareholders in the latest annual report.

"Due to the COVID- 19 pandemic, we expect very few foreign travellers to visit India in the current year and in the next year. The hospitality industry must, therefore, concentrate on domestic travelers," he said.

In 2019, 11 million foreigners visited India. More than 2.5 million of them came through the tourist e-visa scheme, a growth of 24 percent over the previous year.

Visitors from the US accounted for 9 percent of the travellers, the United Kingdom 6 percent and Canada and Australia 2 percent each.

Though India is operating repatriation flights, the government has not announced when it will allow international commercial flights.

On May 25, domestic flights resumed in a staggered manner but airlines are far from flying full capacity.

Over the years, domestic travellers have outstripped foreign visitors, even in the luxury hotel segments but overseas guests still account for around 30-35 percent of the guests, as per industry estimates. Their share is higher in the palace accommodation segment.

For the Taj Hotels Group, one of India’s biggest hotel chains, the composition of foreign guests varies from as little as 1 percent (Ginger Hotels) going up to 50 percent (Taj Hotels).

Oberoi Hotels operate only in the premium and luxury segments, with the Trident and Oberoi brands spread across cities like Delhi, Mumbai and Udaipur. A significant percentage of revenue comes from foreign travellers for the Oberoi Group.

“The contribution of international guests is 20 to 25 percent and domestic make up 75 percent. When it comes to palaces, international travellers make up almost 50 percent. But the palaces are not that large in numbers. International business is very important for us because it is high paying but it’s not the biggest volume driver for us," Puneet Chhatwal, managing director and chief executive of Tata Group-promoted Indian Hotels Company, said in a recent analyst call.

About 10 years ago, the foreign guest composition staying in hotels in India stood at as high as 70 percent. Several of India’s neighbours such as Sri Lanka, Bhutan, Maldives, Mauritius and Nepal depend on foreign travellers for revenue generation.

According to a report by Hotelivate, a consultancy and advocacy firm, over 80 percent of the demand for hotel rooms is generated by domestic travellers.

“Those potential travellers who are not able to travel abroad are stuck here. I’m sure they will need to get out whether they go to Goa or Kerala or Bangalore or Rajasthan; domestic is the one which will come back faster. Also, some countries might put in a protocol for quarantine that people might be discouraged to travel to international destinations,” Chhatwal added.