Visa on arrival for American citizens may boost tourism

The Modi government’s decision to extend ‘visa on arrival’ to US citizens is not just an emotional pitch but makes good economics too. US citizens happen to be the topmost spenders among foreign tourists.

Analysis of tourism ministry and UNWTO data by think-tank Swaniti show that the US citizens are one of the higher spenders in the world with per capita spending at $1350 in 2012. It’s no wonder that India is keen to woo them too.

India received about 6.6 million foreign tourists in 2012 which increased to about 6.9 million in 2013. US is the largest source of foreign tourists to India, accounting for a share of 15.8% or about 1 million tourists. Incidentally, 46% of the tourists traveling from the US come to visit family and friends and spend on shopping, travel and medical treatment among other things.

While much is made of India’s low ranking (it ranks 40th in total foreign tourist arrivals globally) beaten by smaller countries like Thailand and Singapore, the country attracts travelers with deep pockets. We draw one-twelfth of France’s 83 million but rank second only to Australia globally when it comes to per capita spending in the destination country. In fact the per capita spending by foreign tourists in India has increased from $2509 in 2010 to $2732 in 2012.

Himanshi Dhawan

Oct 6, 2014

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