Summer travel from India to international destinations has become costlier this year, with tour package prices rising by about 20–25%. The increase comes as the West Asia conflict pushes up oil prices and airfares, while a weakening rupee adds to the burden.
This has led to a decline in outbound travel during the peak April–June holiday period, despite the Centre reducing Tax Collected at Source (TCS) on overseas tour packages to 2% from earlier higher rates, according to a report by Times of India.
Demand falls as costs rise across key routes
As reported by TOI, industry data shows international travel demand has dropped by 15–20% compared to the same period last year. Travel to the UAE and Gulf region, which earlier accounted for about 35% of outbound trips, has nearly stopped. Travel to Europe has also seen a sharp decline.
Rajiv Mehra, general secretary, Federation of Associations in Indian Tourism & Hospitality (FAITH), told TOI, “We are seeing a significant drop in demand, with an overall decline of 15%–20% compared to last year (April–June 15, 2026 vs April–June 15, 2025). About 35% of Indians were travelling to the UAE and Gulf region, and that travel is now almost negligible. Travel to Europe has also dropped significantly.”
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He added, “The key reason is the war, which has led to higher oil prices and insurance costs, resulting in expensive airfares. Currency depreciation, visa delays have further contributed to the decline.”
Sriharan Balan, Managing Director of Madura Travel Service, said the US dollar has strengthened against the rupee by nearly Rs 10 over the past year, moving from Rs 84 to Rs 94, making international travel more expensive for Indian travellers.
Travel companies said changing costs are also shifting traveller preferences. Demand is now stronger for destinations in the Far East, including Japan, South Korea, Thailand, Vietnam, the Philippines, China, and Australia–New Zealand.
SD Nandakumar, president and country head, Holidays and Corporate Tours at SOTC Travel, told TOI, “Far East such as Japan, South Korea, Thailand, Vietnam, the Philippines, China and Australia–New Zealand remain preferred. Nepal and Sri Lanka, along with domestic travel across Kashmir, Ladakh, Himachal, Kerala, the Andamans and the Northeast, continue to see steady traction.”
(With TOI inputs)
This has led to a decline in outbound travel during the peak April–June holiday period, despite the Centre reducing Tax Collected at Source (TCS) on overseas tour packages to 2% from earlier higher rates, according to a report by Times of India.
Demand falls as costs rise across key routes
As reported by TOI, industry data shows international travel demand has dropped by 15–20% compared to the same period last year. Travel to the UAE and Gulf region, which earlier accounted for about 35% of outbound trips, has nearly stopped. Travel to Europe has also seen a sharp decline.Rajiv Mehra, general secretary, Federation of Associations in Indian Tourism & Hospitality (FAITH), told TOI, “We are seeing a significant drop in demand, with an overall decline of 15%–20% compared to last year (April–June 15, 2026 vs April–June 15, 2025). About 35% of Indians were travelling to the UAE and Gulf region, and that travel is now almost negligible. Travel to Europe has also dropped significantly.”
(Join our ETNRI WhatsApp channel for all the latest updates)
He added, “The key reason is the war, which has led to higher oil prices and insurance costs, resulting in expensive airfares. Currency depreciation, visa delays have further contributed to the decline.”
Sriharan Balan, Managing Director of Madura Travel Service, said the US dollar has strengthened against the rupee by nearly Rs 10 over the past year, moving from Rs 84 to Rs 94, making international travel more expensive for Indian travellers.
Travel companies said changing costs are also shifting traveller preferences. Demand is now stronger for destinations in the Far East, including Japan, South Korea, Thailand, Vietnam, the Philippines, China, and Australia–New Zealand.
SD Nandakumar, president and country head, Holidays and Corporate Tours at SOTC Travel, told TOI, “Far East such as Japan, South Korea, Thailand, Vietnam, the Philippines, China and Australia–New Zealand remain preferred. Nepal and Sri Lanka, along with domestic travel across Kashmir, Ladakh, Himachal, Kerala, the Andamans and the Northeast, continue to see steady traction.”
(With TOI inputs)
