Thailand Expects More Visitors From India’s Growing Middle-Class

The tourism industry in Thailand is down right now but it is not completely out because it is getting some interim support from visitors coming from its neighbour India. At a beachfront hotel in Phuket, occupancy rates for Chinese visitors have stalled but bookings from India are on the rise.

The influx of Indian visitors is starting a new trend and they are now driving the tourism industry similar to what the Chinese have done.  Other Asian countries are watching Thai tourism trends closely. It seems that Chinese outbound tourism has matured while new India has emerged.

Thailand’s tourism industry has been expanding at an average of 10% per year due to the increase in Chinese arrivals. However, the 2018 boat tragedy in Phuket that killed 47 Chinese tourists has not been forgotten. Add to that the variables of a slowing economy and the trade war between the US and China. It is not surprising for tourism growth to be negatively affected.

In contrast, arrivals from India have significantly increased in recent months because of more direct flights, visa-free waiver and the increasing wealth of the growing middle-class in India. There has been a rapid expansion in India’s middle class which has prompted the Thailand tourism authorities to upgrade their estimations of Indian visitors.

At least 10 million arrivals are expected by Thailand by 2028 which is more than five-fold increase over the visits last year. This growth trajectory closely mimics the Chinese visits that increased from 800,000 in 2008 to more than 10 million in 2018.

China remains to be an important market but it is very unlikely to offer growth potential in the coming years. Meanwhile, India is expected to become to the new expansion story in Thailand’s tourism that contributes 17% of the country’s GDP annually. Chinese arrivals are expected to drop as the Yuan weakens against the baht.

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