Amid slowing tourism growth, made worse by the coronavirus outbreak, the Indian tourist market represents a ray of light and hope. India is one of Thailand's fastest growing feeder markets, and maybe it is time we started paying more attention to increasing the share of this market, apart from focusing on Chinese tourists as we have in the recent years.
Visitors from India, with the world's second largest population behind China and a fast-growing economy, will undoubtedly be a strong foundation for Thailand's tourism industry.
Today only around 20 million Indians travel outside the country each year for business or leisure.
However, according to the country's External Affairs Ministry, there are more than 65 million passport holders in India. This big gap suggests there will be more opportunity to serve Indian tourists going abroad within the next 3-5 years.
Thailand is one of the top destinations for Indian tourists, along with Singapore, Malaysia and Australia.
According to records, 1.9 million Indian visitors came to Thailand last year, with year-on-year growth of 25%. There was clearly a strong response to the waiver of visa-on-arrival fees in November 2018, which has now been extended until April 2020.
Increasing internet access is an important factor inspiring Indians to travel. Nearly 35% of Indian travellers will be booking trips through online channels by 2021, according to a Bain & Co report titled "How Does India Travel?".
Mid-market and budget hotels accounted for 48% of Indian accommodation spending, which is expected to accelerate at a compound annual growth rate of 15% over the next three years.
The availability of short-haul direct flights is another key contributor to demand and Thailand is only 1½ hours ahead of India. In the past three years, both full-service and low-cost airlines have opened new direct flights between Thailand and many cities in India.
Interestingly Indian tourists are likely to visit Thailand during the low season, when most hotels, restaurants and tour operators report low occupancy. This could provide a long-term benefit to the hotel market, especially for resort destinations such as Phuket, Chiang Mai and Pattaya.
However, one concern about the Indian market is spending power. Even though India is now the third largest international source market for Thailand, Indian visitors' spending power was ranked fifth, behind Russia and Japan.
Looking ahead, although China remains the biggest feeder market for Thai tourism, the coronavirus outbreak has taught us it is time Thailand started putting more eggs in different baskets to reduce risks from relying too heavily on a single feeder market.
Pawika Thienwongpetch is an analyst with Research and Consulting, CBRE Thailand. She can be reached at bangkok@cbre.co.th