India's tourism sector is being influenced by two simultaneous shifts: a connectivity build-out that is bringing destinations into wider travel circuits, and a broadening of demand beyond leisure and heritage travel. As per the CBRE South Asia Limited’s and ASSOCHAM’s latest report titled "Reimagining Indian Tourism: Unlocking the Next Wave of Growth". The report notes that India's expressway network has begun functioning as a set of tourism corridors. The Delhi-Mumbai Expressway now connects Jaipur, Ranthambore, Sariska and Ahmedabad along a single heritage and wildlife corridor; the Samruddhi Mahamarg links Shirdi, Nashik, Trimbakeshwar and the Ajanta and Ellora caves; the Bundelkhand Expressway brings Khajuraho, Orchha, Chitrakoot and Jhansi into one circuit.
Upcoming corridors, including the Char Dham Mahamarg, Shaktipeeth Expressway and Somnath-Dwarka Expressway, are set to create further multi-destination itineraries. The report observes that the rail and alternative transport are extending this shift. Dedicated tourism circuits, luxury heritage journeys and panoramic coaches have also added a distinct tourism dimension to rail travel, while the strongest growth in high-speed rail has been concentrated along pilgrimage corridors. Improved access to Kashmir and the Northeast is opening up leisure and cultural markets previously constrained by travel time.
The report points out that ropeways and river cruise circuits are emerging as mobility options in hill, riverine and island destinations where conventional infrastructure is limited. The report further notes that demand has broadened into segments with materially different real estate requirements. Spiritual travel is generating demand across hospitality, transport and retail around pilgrimage centres, with premiumisation creating scope for experiential and higher-value stays. MICE and destination weddings are creating demand for convention and event infrastructure in emerging cities. Wellness and medical travel are supporting hospital-adjacent and retreat formats.
Another interesting aspect is that cruise tourism is driving hospitality, retail and F&B development around port terminals. Rural tourism is growing largely through existing housing stock rather than new construction, creating a low-capital but fragmented market. Wildlife lodges, constrained by regulation near reserves, are emerging as a potentially high-yield niche as branded operators enter destinations such as Ranthambore and Satpura.
As per CBRE's hospitality data this broader demand base is translating into stronger hotel performance. Occupancy across India's organised hotel sector rose to 64.1 per cent in 2025 from 42.0 per cent in 2021, with Average Daily Rate (ADR) growth lifting Revenue Per Available Room (RevPAR) above pre-pandemic levels. Leisure markets are also recording strong occupancy alongside gateway metros, with Goa at 75-80 per cent and Jaipur at 62-67 per cent, while Bengaluru led RevPAR growth at 20-25 per cent year-on-year.
The report highlights that economy, upper midscale and midscale hotels account for nearly 60 per cent of branded room stock, reflecting a diversified supply base catering to a broad spectrum of travellers. In Uttar Pradesh, inventory has grown 18 per cent since 2021, with the midscale share rising from 15 to 19 per cent. .
As per the report India's tourism activity continued to expand in 2025, led by strong domestic travel and rising outbound departures that reflect growing traveller spending power. Inbound tourism, which drives foreign exchange earnings, remains the segment with the most room to grow, as India's share of global receipts still points to significant headroom.
The report also points out that Foreign tourist arrivals (FTAs) have recovered substantially from 2021 levels, although more gradually than domestic tourism. By 2025, domestic tourist visits were well above 2019 levels, while FTAs remained below their pre-pandemic peak.
The CBRE report also says that holistic tourism policies are critical for transforming high- potential locations into globally competitive destinations such as “One State: One Global Destination” initiative seeks to develop at least one world-class tourism destination in every state and Union Territory. Besides that initiatives such as Swadesh Darshan 2.0, PRASHAD, and Dekho Apna Desh complement this agenda through destination development, pilgrimage infrastructure and domestic tourism promotion.
