
The Union Budget 2025-26 underscores the pivotal role of tourism in India’s economic expansion by allocating ₹2,541.06 crore for sectoral growth. With a focus on infrastructure development, skill enhancement, and streamlined travel facilitation, the government aims to position tourism as a major driver of employment and investment.
Tourism’s Role in Economic and Employment Growth

India’s tourism industry has demonstrated a strong post-pandemic recovery, with its contribution to the GDP reaching 5% in FY23. The sector created approximately 7.6 crore jobs in the same fiscal year, and international tourist arrivals (ITAs) have returned to pre-pandemic levels. India’s share in global ITAs was recorded at 1.45% in 2023, contributing $28 billion in foreign exchange earnings. Furthermore, the country ranked 14th globally in terms of tourism receipts.

To strengthen employment-led growth, the Budget introduces various initiatives, including:

- Advanced skill development programs through Institutes of Hospitality Management
- MUDRA loans to support homestay businesses
- Enhanced travel and connectivity infrastructure for key tourist destinations
- Performance-based incentives for states focusing on tourism management and marketing
- Expansion of e-visa facilities, with fee waivers for select tourist groups
Infrastructure Development and Connectivity Enhancement

A significant aspect of the budget is the plan to develop 50 top tourist destinations through a challenge-based model in collaboration with state governments. This initiative seeks to ensure high-quality tourism infrastructure, improve connectivity, and enhance the visitor experience.
States will be required to allocate land for critical infrastructure projects, including hospitality establishments, which will now be categorized under the Infrastructure Harmonized Master List (HML) to attract investments. Additionally, ₹3,295.8 crore has been designated for 40 tourism projects across 23 states under the Special Assistance to States for Capital Investment initiative. This funding will aid in transforming tourist hotspots into globally recognized destinations.
The Swadesh Darshan 2.0 (SD 2.0) program, which promotes sustainable and responsible tourism, continues to expand, with 34 projects already approved under this scheme, receiving a total funding of ₹793.2 crore. To further strengthen employment opportunities in tourism, ₹60 crore has been allocated for skill development programs in FY 2025-26.
Revitalizing Heritage and Spiritual Tourism
Recognizing the cultural and economic potential of spiritual tourism, the government is prioritizing the development of pilgrimage and heritage sites. Special attention will be given to locations associated with the life and teachings of Lord Buddha, in alignment with India’s vision to become a global centre for Buddhist tourism.
The Pilgrimage Rejuvenation and Spiritual Augmentation Drive (PRASHAD) scheme will continue to upgrade infrastructure at significant religious sites, ensuring world-class facilities and accessibility. These measures aim to strengthen India’s position as a hub for spiritual and heritage tourism while driving economic growth.
Advancing Medical Tourism Through “Heal in India” Initiative
The budget also highlights the growing potential of medical tourism as a crucial component of India’s economy. The “Heal in India” initiative will be developed in collaboration with private sector stakeholders to establish India as a premier destination for medical and wellness tourism. By leveraging state-of-the-art healthcare facilities, highly skilled medical professionals, and traditional wellness practices like Ayurveda and Yoga, India seeks to attract international patients seeking high-quality yet cost-effective treatments.
The Medical Value Travel (MVT) sector is experiencing remarkable growth, with its market size projected to increase from $2.89 billion in 2020 to $13.42 billion by 2026. India’s strengths in this sector include:
- Specialized treatment across disciplines such as cardiology, orthopaedics, oncology, and neurology
- A combination of modern medical facilities and traditional wellness systems
- Competitive healthcare pricing compared to other global destinations
To streamline the process for international patients, the government is introducing medical visa facilities with improved documentation services.
Preserving India’s Knowledge Heritage: Gyan Bharatam Mission
The Gyan Bharatam Mission, announced in the budget, is set to undertake large-scale documentation and conservation of India’s manuscript heritage. With the establishment of a National Digital Repository of Indian Knowledge Systems, academic institutions, museums, libraries, and private collectors will collaborate to preserve over one crore manuscripts. This initiative aims to enhance accessibility and knowledge sharing for future generations.
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