India heads growth in tourism spending

India is the fastest-growing Asia Pacific market for international tourist spending, according to new figures released by Visa Asia Pacific.
Visa’s spending data shows that tourists to India spent US$372 million during the fourth quarter of 2005, which represents a 25% increase over the same period in 2004. China, where tourists spent $784 million in the period of October to December 2005, was the second fastest-growing market in Asia Pacific with a 23% year-on-year rise.

India and China also topped the region when it came to average spending per transaction. China recorded the highest amount of spending with an average of $204 spent per transaction, with India right behind at $191. The regional average spend per transaction was US$156.

Overall, international travelers to and within the region spent $6.5 billion on their Visa cards in the final quarter of 2005, representing a 12% increase over the same period in 2004 and a 14% increase over the third quarter in 2005 [$5.8 billion].

“While tourism spending is up virtually across the board, our data confirms that India is rapidly becoming a more mainstream tourism destination, with tourist receipts expected to grow significantly over the next few years,” said Paul Dowling, Visa Asia Pacific’s Executive Vice President for Corporate Relations. “In Q4, our numbers show that India is quickly emerging as a destination of choice among travelers from the US, UK, France, Australia and Germany in numbers we have not previously seen.”

The top five regional destinations that benefited from the increase in inbound tourist spending over the previous final quarter were Australia ($1.1billion), China ($784 million), Thailand ($783 million), Hong Kong ($647 million) and Japan ($452 million).


Tourists from the US, UK, Japan, Australia and Hong Kong were the biggest spenders in Asia Pacific, accounting for 54% of total spending on Visa cards between October and December 2005.

By region, Asia Pacific cardholders were the biggest spenders, making up 42% of the total tourist spending. European Union cardholders accounted for 32%, US cardholders made up 20% of the total, while cardholders from Eastern Europe, the Middle East and Africa contributed 3% and Canadians accounted for 2%.

In all, international tourists made over 42 million Visa transactions in the region between October and the end of December 2005 and withdrew $1.4 billion in cash at ATMs and over-the-counter outlets. Visitors mainly used their Visa cards on retail goods (26%), accommodation (21%), transportation (11%), sports and leisure activities (6%), and restaurants (5%). The top retail merchants were clothing stores ($351 million), department and discount stores ($283 million) and shops selling jewelry, watches and crystal ($241 million).

“Over the years, Visa Asia Pacific has collaborated with several national tourism organizations to help grow tourism and cascade benefits to local economies,” said Mr. Dowling. “In India, for example, Visa is assisting the Ministry of Tourism’s ‘Incredible India’ program by promoting India as a preferred travel destination and providing tourists with direct access to merchants, thereby helping them to plan their visit more effectively.”

Of the total tourist spending within Asia Pacific, 7.3% occurred at online merchants, a year-on-year increase of 58% from 2004 in terms of transaction amount.