Social media trends and rising incomes are driving people to spend more on travel or eating out, but a Moneycontrol analysis shows that India’s restaurant and hotel industry still has a long way to go to reach the levels achieved by developed nations.
The hotels and restaurants industry accounted for just 0.9 percent of the GDP in 2022-23, compared with 4.9 percent in the US and 6.4 percent in the UK.
Prime Minister Narendra Modi, pointing to the Coldplay concerts in Mumbai and Ahmedabad, extolled the virtues of the concert economy and urged states to develop infrastructure in this regard.
“In a country which has such a rich heritage of music-dance, storytelling, where there is such a large pool of youth who are a huge consumer of concerts, there are many possibilities for the concert economy," the PM said.
"You are seeing that in the last 10 years, both the trend and demand for live events have increased. In the last few days, you must have seen the wonderful pictures of the 'Coldplay concert' held in Mumbai and Ahmedabad. This is proof of how much scope there is in India for live concerts,” he further noted.
An earlier analysis by Moneycontrol found that while interest in concerts is driving inflation of recreational services, the share of economy is still minuscule.
In contrast, in 2023, outdoor events, including concerts and related travel and tourism opportunities, accounted for 1.6 percent of the GDP or $448 billion in the US.
In the UK, outdoor events, other than conferences, accounted for 28 billion pounds or 1 percent of the GDP, as per the UK Events Industry report.
Analysis showed that the share of hotels and restaurants has remained constant over the last decade and a half in India.
While the hospitality sector had a 1.03 percent share of GDP in 2011-12, this declined to 0.97 percent prior to the pandemic and further to 0.89 percent in 2022-23.
The industry is likely to have done better in subsequent years.
The trade, hotels and restaurants sector recorded 6.2 percent growth in 2023-24 and 8 percent in 2024-25.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
