India Budget 2026: Travel and tourism industry seeks demand boost, infrastructure support

MUMBAI: As the Union Budget 2026 approaches, stakeholders across India’s travel, tourism and hospitality sectors are seeking policy continuity, improved financing frameworks and measures to stimulate consumer spending. While domestic travel demand has remained resilient, foreign tourist arrivals are still below earlier peak levels, prompting industry leaders to look to the Budget for support on infrastructure creation, connectivity and ease of doing business.

Hospitality & Tourism Outlook

“The Indian hospitality industry has been in a sweet spot in recent years amidst persistent demand-supply imbalances and a structurally favourable environment. However, foreign tourist arrivals are still below past peak levels. ICRA expects the upcoming Union Budget to continue its focus on tourism and infrastructure investments, ease of doing business, enhanced connectivity and accessibility. With supply growth continuing to lag demand, policy frameworks aiding favourable financing terms shall support inventory addition,” said Srikumar Krishnamurthy, Senior Vice President & Co-Group Head, Corporate Ratings, ICRA Ltd.




Echoing the need for policy stability and demand stimulation, BLS International highlighted the importance of global mobility and consumer spending.

“India’s travel and tourism ecosystem has benefited significantly from the Government’s progressive policy outlook towards global mobility and ease of travel. We hope the government maintains this positive outlook. In addition, continued policy support through the upcoming Union Budget—particularly through certain measures to increase the disposable income, as well as targeted travel incentives—would encourage people to spend more on both domestic and international travel, boosting the overall tourism industry,” said Shikhar Aggarwal, Joint Managing Director, BLS International.

He added that a review of the current foreign exchange limits and taxes on forex transactions would further support this momentum by easing cash-flow pressures for travellers and service providers.

Island Tourism and Maritime Connectivity

From the marine tourism segment, Nautika underscored the need for easier permits and modern maritime infrastructure to unlock island tourism potential.

“As an industry we’re expecting that the government adds more facilities so that people visit touristy destinations like islands more in 2026. The company supports laws that make it easier to get permits for high-end services and improve shipping infrastructure. Better ports, eco-friendly ship technology and easy movement between islands would not only aid tourists and operators but they would also help the economy grow and create jobs in the area,” said Anoop Kumar, Founder and Director, Nautika.

He noted that more than 2.5 million passengers are served each year and that the segment is growing rapidly, adding that “rules and incentives that promote modern maritime services will help open up new tourism potential” and signal that India is serious about sustainable tourism-led growth.

Overall, industry expectations from Union Budget 2026 centre on sustaining investments in tourism and transport infrastructure, improving connectivity and accessibility, easing financial and regulatory bottlenecks, and boosting consumer spending power—seen as critical to reviving inbound tourism and supporting the next phase of growth in India’s travel and tourism ecosystem.