Business travel is likely to come back to 2019 level by next year, according to Santosh Kumar, country head of Booking.com. However, he believes overall demand in travel is likely to be impacted next year due to capacity constraints, as well as higher airfares and hotel tariffs.

Speaking to businessline, Kumar said that while leisure travel has touched the 2019 level, business travel continues to be below the pre-Covid level. “However, I expect business travel to be back to the pre-Covid levels next year.”

He pointed out that the industry has been struggling with capacity constraints which has been a deterrent for international travel, especially, business travel. “While short haul capacity is at par, visa issues and capacity addition to long haul destinations continue to be a constraint. So, travel to East Asia and other neighbouring countries has improved but not so much to Europe and the US. Having said that, with capacity addition, I believe that next year, we’ll cross pre-Covid levels.”

Demand woes

However, he said that the travel industry must brace itself for a hit in demand.

Foreign Tourist Arrival (FTAs) in the first half of CY23 have gone up by 106 per cent, only short of pre-Covid levels by 17 per cent. This means that inbound tourism is inching close to pre-Covid levels. Experts believe that this year, FTAs will return to pre-Covid levels, according to Ministry of Tourism data.

“The airfares and hotel tariffs have been consistently high. Amid the current scenario, I believe that the demand will take a hit. I do not expect customers to keep paying. It is now a matter of time and we have to wait and watch when it is going to actually happen.”

FEE

Foreign exchange earnings (FEEs) are 46 per cent higher compared to last year and 12 per cent higher than pre-Covid levels, according to data from the Ministry of Tourism.

Booking.com, which has traditionally been a hotel booking platform, has added flight bookings in 50 countries where it operates, including in India.

Sports tourism

Booking.com is the hospitality sponsor for ICC Men’s World Cup, 2023, which is being held in India. Kumar said that the company has “benefitted a lot” from this partnership, as sports tourism is something the company wants to continue to focus on. He said globally, the Amsterdam-headquartered company has sponsored multiple sports events, and sees a potential for growth in this segment.

According to Kumar, the flight booking segment has been growing at a fast pace in India with a 50-60 per cent quarter-on-quarter growth in this segment. Though, he sees scope for improvement by adding more inventory on to the platform.

Speaking about the hotel business, he said that alternate accommodation has been growing leaps and bounds for the company in India where it is a “promising competitor” to the existing players.

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