Iran war disruptions and Modi’s call to boost India’s hospitality sector

Hello, this is Priyanka Salve, writing to you from Singapore.

Welcome to the latest edition of “Inside India“ — your one-stop destination for the stories and developments of the world’s fastest-growing major economy.

The conflict in the Middle East has affected India’s economy, with Prime Minister Narendra Modi urging citizens to limit foreign travel, conserve fuel – and even suspend gold purchases. This dark-sounding appeal is proving to be a boon for India’s domestic travel and tourism industry.

Keep reading!

Any ideas for today’s newsletter? Share them with the team.

The conflict in the Middle East is causing serious economic difficulties for India, with a weakening of its currency, a rising import bill and growing concerns over a slowdown in growth.

Rajeev Menon, president of APAC ex-China at Marriott International, told CNBC: “Squawk Box Asia” that revenue per available room in May was “back to double digits” and that “the pace remains quite strong” for the months to come.

In 2025, more than 14 million Indians took leisure trips abroad, according to government data. A significant portion of that will shift to local tourism as disruptions from Iran’s war persist, experts say.

Over the past few weeks, travelers who would have otherwise opted for a summer vacation abroad have chosen to explore destinations in India, said Devendra Parulekar, founder of SaffronStays.

SaffronStays, a popular Indian platform for renting high-end vacation properties, told CNBC that its bookings for May were up almost 40%, while forward bookings for June were almost 50% higher than a year earlier.

The company is seeing increased demand for its luxury properties located near the foothills of the Himalayas, as travelers find it difficult to escape to Europe to escape the scorching heat of the Indian summer.

Indian Hotels Company is particularly exploring the opportunities arising from the shift of overseas destination weddings to India.

A study carried out by an industry body, the Confederation of All India Traders believes that weddings generate business worth 6.5 trillion rupiah (nearly $68 billion) during the peak season from November to December 2025.

Wedding celebrations could become “a much bigger business”, with the shift to domestic venues, said Puneet Chhatwal, CEO of Indian Hotels Company.

This would amplify demand for hotels, which already exceeds supply, he said, adding that the Indian hotel chain expects room rates “to increase by at least eight to 12 percent.”

The World Travel and Tourism Council has been very optimistic about the increase in outbound travel from India and predicts that the opportunity could be as big as China’s over the next decade. But until the disruption caused by the war in Iran continues, Indian travelers’ wanderlust is unlikely to cross borders.

Indian telecommunications major Bharti Airtel redoubles its efforts in Africa, with the British BT
Second largest telecom company in India, Bharti Airtelis increasing its investments in companies in Africa and the United Kingdom, joining a growing number of companies in the South Asian country looking to expand their global presence.