Pre-Budget 2026: Travel & Hospitality Seek Policy Push to Sustain Demand

Pre-Budget 2026: Travel & Hospitality Seek Policy Push to Sustain Demand

By Hariharan U

Published on January 30, 2026

As the Union Budget 2026 approaches, India’s travel and hospitality sector is looking to policy support to consolidate the strong demand witnessed across domestic and international travel segments. While occupancies and travel intent remain healthy, industry leaders believe structural reforms are essential to ensure long-term, quality-led growth and global competitiveness.

The hospitality sector continues to benefit from experiential travel, destination weddings and wellness-led stays. However, industry stakeholders point out that high capital costs and limited access to long-term financing continue to put pressure on returns. Granting infrastructure status, offering tax incentives on capital expenditure and improving access to institutional credit are widely seen as critical steps to enable sustainable expansion across destinations.

Digital travel platforms and alternative accommodation providers are also playing an increasingly important role in shaping India’s tourism ecosystem. With demand rising for hotels, homestays and BnBs across Tier-II and Tier-III cities, the industry has reiterated the need for GST rationalisation, especially in the mid-scale segment, to keep travel affordable and ensure price consistency. Support for integrated digital booking platforms and skill development across tourism services is expected to improve transparency and enhance the overall traveller experience.

Outbound travel remains a key focus area ahead of the Budget, particularly as luxury and experiential travel from India gains momentum. Louis D’Souza, Managing Partner, Tamarind Global, says, “As luxury and experiential travel from India continues to gain momentum, the Union Budget can play a pivotal role in shaping both outbound and inbound travel sentiment. On the outbound side, high-spending Indian travellers are increasingly investing in curated, design-led experiences, but policies around TCS and forex costs continue to influence booking timelines and destination choices. Easing these financial frictions would boost travel confidence and encourage travellers to upgrade experiences rather than compromise on quality.”

He further adds, “Equally important is the opportunity to strengthen India's inbound tourism narrative. With global travellers seeking authentic, immersive journeys, India's rich cultural heritage, wellness offerings, luxury hospitality, and emerging experiential circuits are uniquely positioned to attract high-value inbound travellers. Strategic budgetary support for destination marketing, infrastructure upgrades, simplified visa processes, and enhanced connectivity can significantly elevate India's appeal as a premium travel destination.”

Long-haul leisure and island destinations are particularly sensitive to outbound travel costs. Leena Jhugroo, Managing Director, Travel Lounge Leisure & Tours Ltd., notes, “As India's outbound travel market matures, the Union Budget presents an opportunity to unlock sustained long-haul leisure growth. A key expectation from the industry is rationalisation of TCS on overseas tour packages and forex spends, which continues to impact travel affordability and decision-making for Indian consumers.”

She adds, “For island destinations like Mauritius, which are positioned around romance, luxury, wellness, and MICE, easing outbound travel costs would significantly boost bookings. Improved forex policies and incentives for international travel-linked services would further encourage longer stays and higher spends.”

Neighbouring destinations are also closely watching India’s policy direction. Highlighting Sri Lanka’s strong reliance on Indian travellers, Charith DeAlwis, CEO, Unique Lanka Travels, says, “India continues to be one of the most important and consistent source markets for Sri Lanka, driven by strong cultural ties, short travel time, and a growing appetite for nearby international destinations.”

He further states, “As the travel ecosystem evolves, policies that enhance ease of travel, cost transparency, and regional connectivity can play a meaningful role in encouraging more frequent visits and longer stays.”

Within the premium segment, luxury travel operators stress the importance of addressing cost inefficiencies to sustain aspirational demand. Mir Musa Baghirzade, Sales Director, Turalux, says, “The Union Budget is closely watched by the luxury travel sector, as policy decisions directly influence discretionary spending and travel intent. Indian travellers today are aspirational, well-informed, and willing to invest in unique global experiences, but cost inefficiencies, such as high TCS on outbound travel can act as friction points.”

He adds, “Additionally, continued emphasis on digital payments, ease of global banking, and improved forex accessibility would enhance the overall booking experience. Luxury travel is no longer limited to leisure alone; it now extends to wellness retreats, destination celebrations, and immersive experiential escapes.”

Across segments, industry leaders have also called for stronger focus on manpower development, improved aviation connectivity and expansion of air networks to unlock new travel corridors. As the sector enters 2026 with cautious optimism, stakeholders agree that a forward-looking Budget balancing domestic, outbound and inbound tourism priorities could play a defining role in shaping India’s travel growth story


Cygnett Expands Cozzet into Odisha with 50-Room Gopalpur Beach Hotel

Cygnett Expands Cozzet into Odisha with 50-Room Gopalpur Beach Hotel

By Manu Vardhan Kannan

Published on August 27, 2026

Cygnett Hotels & Resorts is expanding its presence in Odisha with the signing of Cozzet VICASA Gopalpur, a 50-room brownfield hotel located around 800 metres from Gopalpur Sea Beach. The property is scheduled to open in March 2027, with several rooms offering sea views.

The signing supports Cygnett’s plans to grow through brownfield conversions and asset-light management opportunities across Tier II, Tier III and emerging micro-markets. The move comes as domestic travel continues to grow and more travellers look for professionally managed accommodation beyond major cities.

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According to HVS ANAROCK's India Hospitality Industry Overview 2025, Tier III and IV markets accounted for 44% of hotel keys signed and 55% of properties signed during 2025, highlighting the growing role of emerging destinations in India’s hospitality sector.

Located along Odisha’s southern coastline, Gopalpur is developing as a coastal leisure destination, combining beach tourism and weekend travel with access to the region’s natural and cultural attractions. The upcoming hotel is expected to cater to leisure travellers, families, weekend guests, weddings and small corporate groups.

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Commenting on the signing, Mr. Sarbendra Sarkar, Founder & Managing Director, Cygnett Hotels & Resorts, said, “India's hospitality growth is increasingly being driven by emerging cities, pilgrimage centres and leisure micro-markets. Gopalpur fits strongly into this strategy. Through brownfield conversions such as Cozzet Vicasa Gopalpur, we can bring quality existing assets into a professional brand, distribution and operating ecosystem while creating long-term value for hotel owners.”

A Contemporary Coastal Stay

Cozzet VICASA Gopalpur will feature 50 guest rooms, including sea-view rooms, along with approximately 2,500 sq. ft. of banquet and event space that can accommodate around 180–200 guests. The hotel will also feature a rooftop restaurant serving regional delicacies and global cuisine in a relaxed coastal setting, adding to its appeal for both leisure and social gatherings.

Cozzet’s Smart, Safe & Sensible Approach

Positioned in the value-driven hospitality segment, Cozzet by Cygnett follows its “Smart, Safe & Sensible” hospitality philosophy. The brand focuses on clean and comfortable rooms, modern amenities and dependable service at an accessible price point.

With branded economy accommodation still having relatively low penetration across India, Cygnett sees considerable potential for organised hotel brands in emerging cities and destinations. Cozzet by Cygnett currently has a development pipeline of more than 600 keys, with hotels at different stages of development and pre-opening across destinations including Noida, Ayodhya, Amritsar, Jaipur and Arunachal Pradesh.

The Gopalpur signing further strengthens Cygnett’s plans to build a scalable network across regional business centres, pilgrimage destinations, coastal leisure markets and other emerging micro-markets where demand for quality branded accommodation continues to grow.


ITC Hotels Signs Storii Havelock in the Andaman & Nicobar Islands

ITC Hotels Signs Storii Havelock in the Andaman & Nicobar Islands

By Manu Vardhan Kannan

Published on August 26, 2026

ITC Hotels Limited has signed a management agreement for Storii Havelock, a 22-key boutique retreat in Swaraj Dweep (Havelock Island), expanding its presence into the Andaman & Nicobar Islands under the Storii by ITC Hotels brand.

Set amid the natural beauty of the Andaman Islands, the property will offer guests an intimate island retreat surrounded by beaches, clear waters, tropical landscapes and rich marine biodiversity. The hotel is planned around the laid-back character of the destination, giving travellers a setting to enjoy the island’s natural surroundings.

Storii Havelock will feature well designed rooms and suites, along with an all-day dining restaurant, bar, swimming pool, fitness centre, spa and kids' play area. The facilities are planned to offer guests a comfortable stay while keeping the island experience at the centre.

Anil Chadha, Managing Director, ITC Hotels Limited, said, "Swaraj Deep (Havelock Island) has emerged as one of India's most sought-after leisure destinations, drawing travellers with its unparalleled natural beauty and distinctive experiences. The signing of Storii Havelock reflects our strategy of expanding across high-potential leisure markets through properties that are rooted in their surroundings. We look forward to introducing the Storii brand to the Andaman & Nicobar Islands."

Arjun Kapoor, Director, M/s Waterwoods Lodge and Resorts Private Limited, said, " We are pleased to collaborate with ITC Hotels on this project. Swaraj Deep continues to attract travellers seeking a blend of nature, adventure and relaxation. We are confident that Storii Havelock will create a compelling hospitality offering that reflects the true spirit of the Andaman Islands.”

The signing marks the entry of the Storii brand into the Andaman & Nicobar Islands and adds another leisure destination to ITC Hotels’ growing portfolio. With its boutique format and island setting, Storii Havelock is positioned to offer travellers an authentic retreat while supporting the continued growth of the region’s hospitality landscape.


ALIVAA Hotels Opens Third Hotel With Existing Partner in 12 Months

ALIVAA Hotels Opens Third Hotel With Existing Partner in 12 Months

By Manu Vardhan Kannan

Published on August 26, 2026

ALIVAA Hotels & Resorts has opened Alivaa Boutique McLeod Ganj, marking the third hotel entrusted to the company by owner Rakesh Rawat within 12 months. The new property is also ALIVAA’s second hotel in the Dharamshala–McLeod Ganj belt.

The latest opening highlights the growing confidence of hotel owners in ALIVAA’s management platform. Following the management of Rawat’s properties in McLeod Ganj and Manali, the third mandate adds to the company’s presence in Himachal Pradesh while strengthening its relationship with the owner.

For a hotel management company, repeat partnerships can be an important measure of performance, as they reflect an owner’s experience with the company’s operations, commercial results and day-to-day management.

Set against the Dhauladhar ranges, Alivaa Boutique McLeod Ganj offers a boutique hospitality experience that combines contemporary comforts with the cultural character of Himachal Pradesh. The hotel features thoughtfully curated accommodations, personalised service and local experiences designed for leisure travellers looking for an authentic mountain getaway.

Vikramjit Singh, Founder & Chairman & Managing Director, ALIVAA Hotels & Resorts, said:

“The opening of Alivaa Boutique McLeod Ganj represents another important milestone in our expansion journey. While every new hotel is significant, what makes this launch particularly meaningful is the trust our partners continue to place in us. Having Mr. Rakesh Rawat entrust ALIVAA with three properties within a single year is a strong endorsement of our operating philosophy, our commercial capabilities and our commitment to creating long-term value for hotel owners. Relationships built on trust remain the foundation of our growth.”

Akash Bhatia, Chief Executive Officer, ALIVAA Hotels & Resorts, said:

“Alivaa Boutique McLeod Ganj reflects our vision of delivering high-touch hospitality supported by revenue management and distribution excellence. Every property we manage benefits from a centralized commercial strategy, sophisticated revenue optimization and strong market positioning, allowing owners to maximize returns while preserving each hotel’s unique identity. Mr. Rawat’s decision to expand his partnership with us for a third property within a year is the strongest validation of our business model and we remain focused on accelerating growth across India’s leading leisure and business destinations.”

For Rakesh Rawat, Owner, Alivaa Boutique McLeod Ganj, the decision to partner with ALIVAA again follows the performance of his existing properties under the company’s management.

“Over the past year, ALIVAA Hotels & Resorts has consistently demonstrated professionalism, transparency, and a strong understanding of what it takes to operate successful hotels in competitive leisure markets. After seeing the performance of my existing properties under their management, partnering with them for a third hotel was an easy decision. I am confident that Alivaa Boutique McLeod Ganj will benefit from the same operational excellence and commercial expertise while offering guests an exceptional hospitality experience.”

With the opening of Alivaa Boutique McLeod Ganj, ALIVAA continues to expand its presence across leisure and business destinations while building its hotel management portfolio through repeat owner partnerships.

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