According to World Tourism Organization, Indians are spending more than twice the amount on international travel as per June 2019, as opposed to what they spent in 2017. The numbers of Indians already having travelling overseas so far this year is close to 5 crores; quite a hike from the 2.4 crore Indians who travelled abroad in 2017.
Speaking of how much forex has been spent on travels, it comes down approximately to to $596 million. It’s the highest since Reserve Bank of India (RBI) started collating data under the liberalised remittance scheme since 2004. The expenditure on foreign trips accounts for a larger share of the total forex spend.
In the first quarter of Financial Year 2019, international travel cost the country $1,594 million of the total $4,181 million forex purchased by Indians between April and June 2019. There’s a 42% increases from the $1 billion out of a total spend of $3 billion done a year ago in April-June 2018.
Indians purchase forex for various reasons, and the RBI categorises them under various heads such as travel, education, purchase of property, gifts, investments and maintenance of close relatives. After travel, the second-highest category has been education. RBI’s numbers show that of the total $13.8 billion spent by Indians in Financial Year 2019, $4.8 billion (35%) was on travel, $3.6 billion (26%) on education, followed by $2.8 billion (20%) for maintenance of close relatives and nearly $1.4 billion on gifts to the relatives overseas.
The sector that has crashed in terms of overseas spending is on the purchase of property or equity investments. Total money spent by individuals for the purchase of property abroad over the last three years looks like this: less than $4 million in June 2019, $7.7 million in June 2018 and $10 million in June 2017. These numbers however, take into consideration the transactions done in an individual capacity and do not account for investments done by high net worth individuals through a corporate route.