In her Union Budget 2025-26 speech, Finance Minister Nirmala Sitharaman unveiled a series of strategic initiatives aimed at revitalizing India’s travel and tourism sector. With a strong focus on employment-led growth, the government has introduced measures that emphasize destination development, skill enhancement, improved connectivity, and medical tourism. These initiatives align with the broader vision of transforming India into a globally competitive tourism hub.
Transforming Top Tourist Destinations
As part of the budget, the government has identified the top 50 tourist destinations across India for comprehensive development. These sites will be upgraded in partnership with state governments through a ‘challenge mode’ approach, ensuring that funding and implementation are awarded competitively. States will be required to provide land for infrastructure development, ensuring a seamless execution of projects. Furthermore, hotels in these destinations will be classified under the Harmonized Master List (HML) of infrastructure, a move aimed at boosting investments in the hospitality sector.
The top 50 tourist destinations in the country will be developed in partnership with states through a challenge mode. Land for building key infrastructure will have to be provided by states. Hotels in those destinations will be included in the infrastructure HML,
Nirmala Sitharaman
Five Key Initiatives to Drive Tourism Growth
To facilitate job creation and improve the overall tourism experience in India, the budget outlines five crucial measures:
- Skill Development – Recognizing the importance of a well-trained workforce, the government will roll out intensive training programs for youth, particularly through Institutes of Hospitality Management. These programs will enhance skills in the tourism and hospitality sectors, equipping young professionals with industry-specific expertise.
- Financial Support for Homestays – To encourage community-driven tourism and local entrepreneurship, the government will extend MUDRA loans to homestay operators. This initiative will empower small-scale tourism entrepreneurs, allowing them to offer quality lodging experiences to travelers.
- Enhanced Connectivity – Improved transport infrastructure and streamlined logistics are crucial for seamless travel experiences. The government will prioritize better connectivity to key tourist destinations, facilitating smoother and more efficient travel for both domestic and international visitors.
- State-Level Incentives – To encourage states to actively participate in tourism development, performance-linked incentives (PLI) will be introduced. These incentives will reward states that demonstrate excellence in destination management, cleanliness, and effective marketing of tourist sites.
- Simplified Visa Processes – To attract more international tourists, the government will introduce a streamlined e-visa system. Additionally, visa-fee waivers will be granted to select tourist groups, making it easier and more affordable for foreign visitors to explore India.
To facilitate employment-led growth, we will organize intensive skill-development programs for our youth, provide MUDRA loans for homestays, improve ease of travel and connectivity to tourist destinations, and introduce streamlined e-visa facilities along with visa-fee waivers for certain tourist groups,
Nirmala Sitharaman
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Promoting Spiritual Tourism and Heritage Sites
Building upon the government’s emphasis in the July 2024 Budget, a renewed focus will be placed on tourism destinations of spiritual and religious significance. Specifically, sites associated with Lord Buddha’s life and teachings will receive special attention. This initiative aims to enhance India’s appeal as a Buddhist pilgrimage hub, attracting both domestic and international visitors.
Continuing with the emphasis on places of spiritual and religious significance in the July Budget, there will be a special focus on destinations related to the life and times of Lord Buddha,
Nirmala Sitharaman
Advancing Medical Tourism Through the ‘Heal in India’ Initiative
Recognizing India’s growing potential as a global medical tourism hub, the government will collaborate with the private sector to enhance medical and wellness tourism under the ‘Heal in India’ initiative. This initiative will focus on strengthening healthcare infrastructure and simplifying visa norms for foreign patients seeking treatment in India. The move aims to position India as a preferred destination for high-quality, affordable medical care.
Medical Tourism and Heal in India will be promoted in partnership with the private sector along with capacity building and easier visa norms,
Nirmala Sitharaman
Implications for the Travel and Hospitality Industry
The budget’s tourism-centric measures are expected to drive significant investment, elevate service standards, and generate employment across the travel and hospitality sectors. With a strong focus on infrastructure, skill-building, and global positioning, the government aims to create a sustainable and competitive tourism industry that contributes significantly to India’s economic growth.
These initiatives reaffirm the crucial role of tourism in India’s economic development, offering new opportunities for industry stakeholders while positioning the country as a world-class travel destination. By prioritizing destination upgrades, workforce development, and international tourism facilitation, the government is laying a strong foundation for the long-term growth of the sector.