THE steep depreciation of the rupee has started to pinch the outbound leisure market with the resulting rise in tour package prices, according to Indian travel consultants.
The currency crashed by 11.6 per cent year-on-year last month, reaching an all-time low of 60.73 against the US dollar on June 26.
Vikas Khanduri, managing director and CEO, Viva Voyages, said: “The depreciation of the Indian rupee doesn’t augur well for the outbound leisure market. The price of outbound tour packages has gone up by 15 per cent.”
Rajji Rai, chairman of Swift Group of Companies and advisor of Travel Agents Association of India, estimates a 15 per cent drop in outbound travel because of the rupee’s depreciation.
“The segment that is hit most is the (upper) middle-class travellers who have started to cut down on their travel days to fit their (shrinking) budget,” he said.
The current low season of Indian outbound travel only adds to the woes.
Yet, for major travel company Cox & Kings, there was in fact a five to seven per cent increase in tour package bookings, according to Karan Anand, head of relationships.
“India experienced a similar cycle of uncertainty in 2008 when the world was engulfed in a crisis. However, this did not dampen the Indians’ spirits and they continued to travel overseas. For Indians, travelling overseas is an aspiration and they will not give it up just because of the rupee depreciation,” he said.
India’s hospitality sector too, has not been spared from the free-falling currency and sluggish economy, as the country’s hotels report weaker average occupancy and average room rates (TTG Asia e-Daily, July 2, 2013).