HVS ANAROCK India Hospitality Industry Overview 2022
The year 2022 painted a mixed picture for the global hospitality sector. It was the year that travel finally made a comeback after a majority of countries lifted their travel restrictions and most people resumed their pre-pandemic way of life. As a result, travel demand increased significantly across the globe with people trying to make up for the lost time. However, inflation, the Russia-Ukraine war, and the “great resignation” negatively impacted the hospitality business in a few countries. The Indian hospitality sector also witnessed similar trends during the year but was more resilient than some of its global counterparts.
The year began on a challenging note with weak demand in the first few weeks because of the emergence of omicron cases and the re-introduction of travel restrictions across states. However, unlike the previous COVID waves, this setback was short-lived, and travel demand recovered much more quickly than before. The lower severity of omicron, increased vaccination rate, swift response by the government, quick revisions in restrictions, and the significant pent-up demand for travel contributed to this quick rebound. As a result, hotel occupancy in India crossed the 60% mark in March 2022 – a first since the onset of the pandemic – as several markets began outperforming their pre-pandemic occupancy levels, and the industry has not looked back since.
The beginning of 2023 has been promising, and the outlook for the Indian hospitality industry remains positive. Domestic demand will continue to be strong and international travel is also expected to pick up, despite the looming threat of a recession in the US and Europe, growing global geopolitical issues, and an increase in COVID cases in some countries. In addition, the G20 presidency of India and the fact that India is hosting a number of international events, including the ICC Men's World Cup, will increase demand for hotels in the cities where these events will take place.
