India is one of the fastest-growing economies in the world, and
the business travel spend that originates there is expected to reach $33
billion in 2016 once the final tally is in. That's up from $29.6 billion in
2015, according to a Global Business Travel Association report.
"Our general outlook for Indian business travel
spending remains very positive and has even improved slightly since our
previous outlook," issued about six months ago, the report noted. In July,
GBTA had estimated that business travel spend growth from the second quarter of
2015 to the second quarter of 2016 would come in at 10.2 percent. Now that
those numbers are final, GBTA has found that business travel spend grew 10.9
percent during that period.
GBTA also has revised its growth estimate for international
outbound business travel in 2016 from 3.1 percent to 5.4 percent. And the
association projects faster growth this year. "The brightening prospects
for increased trade activity, especially with the oil-rich [Middle East and North
Africa] region, should help to push [international outbound business travel] spending
forward by 9 percent in 2017," according to the report.
GBTA expects domestic business travel spend, which it
estimates represented 91.4 percent of India's total business travel spending in
2016, to increase 12 percent to $30.2 billion in 2016 and to reach $33.8
billion in 2017.
At the end of 2015, India became the 10th largest global
business travel market, and GBTA expects the country to climb into the sixth
spot by 2019.
The Challenges
"India's inadequate infrastructure continues to present
a significant bottleneck for [economic] growth, but vast improvements are in
the pipeline," including Prime Minister Narendra Modi's plans to improve
ports and transportation and urban infrastructure, according to GBTA.
To fight corruption, the shadow economy,
inflation and counterfeiting, Modi announced in November that 500 rupee notes
and 1,000 rupee notes no longer would be legal tender. "While the goal of
greater financial transparency is laudable, the move could also dislocate
legitimate economic activity, especially in the short term," GBTA said.