Government of India's think tank NITI Aayog has recommended the introduction of a single-window clearance system for homestay registrations to unlock the potential of alternative accommodation in India’s growing tourism industry.

The proposal comes as part of its report, Rethinking Homestays: Navigating Policy Pathways, released by Vice Chairman Suman Bery. The report highlights that the registration process should be simplified, requiring only essential documents such as ownership proof, applicant identification, and GST registration.

To ensure better coordination, the Aayog has also suggested the establishment of a central nodal agency that would streamline communication between departments, stakeholders, and policymakers. This unified approach would help in policy implementation, marketing, and resource allocation.

The report stresses that financial incentives should be destination-focused, promoting tourism development at regional levels instead of focusing only on individual homestay amenities. It further recommends collaborative marketing by state governments to showcase unique regional offerings and support lesser-known destinations through homestays that provide authentic, community-driven experiences.

At the 18th CII Annual Tourism Summit, Suman Billa, Additional Secretary, Ministry of Tourism, echoed the need to expand tourism infrastructure to address rising demand. He outlined a three-pronged strategy for states, granting infrastructure status, rationalizing norms, and simplifying clearances. He also emphasized the importance of increasing international tourism and promoting India globally.

Reports indicate that India’s homestay market reached Rs 4,722 crore in 2024, reflecting strong recovery post-pandemic. The sector’s growth has been driven by booming domestic tourism and changing travel preferences toward experiential stays and unexplored destinations.

The Aayog emphasized the importance of transparent, light-touch regulatory frameworks to ensure safety, protect heritage, and promote inclusive and sustainable growth. With domestic tourism driving recovery and alternative accommodations gaining traction, homestays represent a major economic opportunity for India’s tourism future.