The Union Budget 2025 focuses on boosting infrastructure, consumer spending, and tourism, setting the stage for significant growth across various sectors. Industry leaders from hospitality, retail, and F&B share their views on how these changes will benefit their businesses and the economy. Let’s hear from the experts.
Rajat Agrawal, CEO, Barista Coffee
Budget for the year 2025 entails more income in the hands of the middle class with exemption of income in the hands of the salaries class till INR 12 lacs, this will also benefit individuals at higher earnings. Higher income will support the agenda on spending and will support the middle class on their allocation of funds beyond their daily needs and could benefit the retail industry at large with more money in the hands of the middle class. Further lowering down of taxes for other than salaried class will also support spending.
A deep-rooted plan to bring more investments on building infrastructure and connectivity through dedicated spends on new airports and routes, will further create an opportunity for large reach and mobility which will further support retail businesses with increase in better inter-city connectivity and tourism.
However from a retail industry standpoint there were no direct benefits being passed on even in this year’s budget.
Manoj Bhat MD & CEO Mahindra Holidays & Resorts India Limited
The Union Budget 2025 continues the momentum from the last year by prioritizing infrastructure development, investments, and employment generation. The collaboration with state governments to develop the top 50 tourist destinations, support for skilling the workforce, push for enhanced connectivity will further strengthen the sector. These measures are a clear indication that the sector will attract more investment and will result in job creation thus boosting local economies.
The revised tax slabs under the new income tax regime will add to the purchasing power of the salaried class, increasing disposable income. This is expected to drive higher consumer spending, fueling sustained industry expansion.
Vishal Vitthal Kamat, Executive Director of Kamat Hotels India Ltd, Chairman of CII Maharashtra
This budget is a well-balanced one, covering multiple sectors and ensuring a strong trickle-down effect rather than focusing on just one area. One of the most significant highlights is the revision in the income tax structure, particularly for those earning under ₹12 lakh. The impact of this change is massive, as it will instantly boost consumer spending across various sectors, including hospitality, travel, tourism, and entertainment. The government’s approach is clear—while they may initially forego nearly ₹1 lakh crore in direct tax revenue, they are poised to recover this through increased GST collections. More importantly, this move will drive job creation, economic growth, and an overall surge in consumerism.
Another notable aspect is the UDAN scheme, which has the potential to transform the industry. However, for UDAN to truly succeed, it needs to be executed with consistency and quality. Some operators are currently unreliable, leading to erratic schedules, cancellations, or delays. For this initiative to achieve its full potential, it must be managed with the same efficiency as major airline networks, ensuring seamless connectivity rather than just expanding reach.
Additionally, medical tourism presents a significant opportunity for India. Our country has evolved from being known only for great doctors to offering world-class hospitals and medical infrastructure. With healthcare costs in Europe and the U.S. skyrocketing, India is emerging as a prime destination for international patients. Even after accounting for travel, accommodation, and surgery expenses, treatment in India is often a fraction of the cost abroad. This will drive a substantial influx of medical tourists, further strengthening the economy.
Overall, this budget is a step in the right direction, fostering growth across industries and positioning India as a key global player in multiple sectors.
Abhay Parnerkar, CEO of Godrej Foods Ltd
The Union Budget 2025 takes significant strides in strengthening the F&B and frozen food industries by focusing on self-reliance, value-added processing, and global competitiveness. The emphasis on edible oils and pulses will enhance supply chain stability, while reduced customs duties on marine products will drive seafood exports and bolster India’s presence in global markets.
Investments in post-harvest infrastructure and food processing will not only improve efficiency but also create better income opportunities for farmers by expanding market access. Strengthening the farm-to-fork ecosystem will ensure better quality, reduced wastage, and wider availability of frozen and ready-to-eat foods, ultimately benefiting both producers and consumers.
K.B. Kachru, Chairman, Radisson Hotel Group South Asia & President – Hotel Association of India (HAI)
Budget is progressive, especially with its focus on tourism and job creation. The government’s commitment to developing 50 new destinations, and improving infrastructure, is promising. This year’s budget very well highlights the importance of promoting spiritual and medical tourism with neighbouring countries and simplifying visa processes to enhance international travel. Overall, the initiatives taken by the government in this year’s budget are the steps in the right direction for the industry.
Hotel Association of India
The Budget 2025-26 recognises and highlights the importance of tourism and hospitality as an engine of job creation and promoter of inclusive growth. An infusion of Rs 20,000 crore to increase tourism-led employment is going to help several states that house top tourist locations build infrastructure and boost connectivity. However, the onus has been put on states to acquire land to build hotels and other required facilities.
Top 50 tourist destination sites in the country will be developed in partnership with states through a challenge mode. The key takeaway for us is the fact that Hotels in those destinations will be included in the infrastructure harmonised master list (HML). HAI looks forward to knowing details like the identified 50 destinations etc.
There is a continued focus on connectivity, ease of travel and on spiritual tourism. In addition to projecting India as a birthplace of Lord Ram through the Ramayana circuit, the development and promotion of the Buddhist circuit will also be a priority. The objective would be to increase tourist footfall from South East Asian by including visa fee waivers. The Medical tourism segment or Heal in India is another segment that will receive attention.
The Udan scheme will be extended to connect 120 more destinations further promoting regional connectivity.
The state of Bihar for its Buddhist sites has been identified for improvement and capacity expansion of the existing Patna airport as well as for financial support for a greenfield airport project in the state.
The partnership with states in tourism development with performance-linked incentives, MUDRA loans, intensive skill development for youth will further strengthen tourism.
The achievement of Vikas Bharat through the three Ds Democracy, Demography and Demand was clearly the overriding theme of the budget. We hope that a part of the additional disposal income in the hands of people through the relief on income tax to push demand will be directed towards hotel accommodation.
The Hotel Association of India has been actively advocating for government-private sector partnerships and remains committed to collaborating with authorities to ensure the sustainable development of Indian hospitality, even in the most remote areas.
Tourism has been identified as a key pillar of the economy by our hon’ble PM who has been the best ambassador for the industry.
Even today while commenting on the budget the prime minister spoke about tourism, saying the sector has significant potential. “Hotels will be built at 50 important tourist stations,” he said. He added that including hotels under infrastructure would strengthen tourism and support the hospitality sector, which employs a large workforce.
However, the key industry demand for all hotel projects irrespective of location and star categorisation to be accorded the status of infrastructure needs clarity and execution. The asks of ease of doing business, rationalisation of taxes and of support in reducing the high and largely fixed costs of hotel operations too require attention.
With its vast potential to generate employment across skill levels, including opportunities for women and differently-abled individuals, the hospitality sector can play a crucial role in realizing the “Viksit Bharat “ Vision .
The timing, extent and quantum of support from the government at all levels willdetermine whether the true and full potential of the sector is unleashed. Achieving of our targets for 2047 would be clearly dependent on the execution of the intent.
JB Singh, President & CEO, InterGlobe Hotels
The Union Budget 2025-26 demonstrates a visionary approach to transforming India’s hospitality and tourism sector. The expansion of the UDAN scheme, will significantly enhance regional connectivity and unlock tourism potential.
The budget’s commitment to investing in hospitality training programs at established Institutes of Hotel Management (IHMs) will strengthen the industry’s talent pipeline. Additionally, streamlined e-visa processes and visa-fee waivers will attract more foreign tourists. We believe these strategic measures will drive long-term growth, create employment opportunities, and position India as a premier global tourism destination.
Chander Baljee, CMD Royal Orchid Hotel
The budget offers a positive outcome for the industry. Government’s focus on speedier travel and a modified UDAN scheme connecting 120 new destinations and facilitating travel for nearly 4 crore passengers in the next 10 years will aid much needed penetration for increased tourism demand in the NorthEast region.
The move will not only amplify the efforts of private players but will offer an opportunity to put India in the global map. Additionally, building select destinations across the country for a state tourism boost and employment-led growth will be beneficial for effective destination management. Continued encouragement from the Government on wellness tourism can play a pivotal role for the financial viability of the sector and attract further investment.
Easier visa norms have been long awaited and capitalising on spiritual and religious tourism offers private players a great opportunity to contribute to the growing tourism revenue of the country.
Sameer Mehra, Chief Commercial Officer, THE MRS Group Of Hotels
The Union Budget 2025-26 presents a promising outlook for the hospitality sector, especially with the inclusion of hotels in key destinations under the infrastructure sub-sector. This move will undoubtedly ease access to financing and drive investment in the industry.
The focus on developing new tourist destinations and enhancing connectivity through the UDAN scheme reflects the government’s commitment to making India a more attractive destination for travelers. While these initiatives are encouraging, their true impact will depend on timely and effective implementation. Overall, this budget instills optimism and paves the way for sustainable growth in our sector.
Vinay Dube, Founder and CEO, Akasa Air
The Union Budget 2025 marks a significant step in supporting the sustained growth of India’s aviation sector. We commend the government’s commitment to infrastructure, which will make air travel more accessible, thereby boosting tourism and the economy as a whole.
Aligned with the vision of Viksit Bharat 2047, this focus on aviation strengthens India’s position as a global hub, ensuring greater mobility for all and contributing to a more connected, inclusive nation.
As India’s fastest-growing airline, we applaud the government’s continued efforts to fuel the sector’s growth and make air travel accessible to a greater number of Indians.
Karan Agarwal, Director of Cox & Kings
The Union Budget 2025 takes a well-rounded approach to tourism, recognizing its potential as a key driver of economic growth and employment. The plan to develop 50 destinations and prioritize spiritual and medical tourism is a step in the right direction. Streamlining travel with e-visas and fee waivers will make India more accessible to international tourists, boosting arrivals.
The focus on public-private collaboration in developing 22 top destinations is particularly encouraging. It signals a shift towards structured, long-term growth rather than short-term measures. With the right execution, these initiatives can strengthen India’s position as a leading global tourism destination while creating significant employment opportunities across the sector.
Rajesh Ghanshani, Director of Partnerships, STAAH
We are glad to learn that the Union Budget 2025-26 presents a promising outlook for the hospitality space. The government’s focus on providing infrastructure status to hotels in select tourist destinations will undoubtedly ease access to financial resources and enable much-needed development in key regions.
Additionally, the introduction of initiatives like the promotion of medical tourism and the provision of Mudra loans for homestays will create avenues for rural tourism within the hospitality sector. This budget aligns well with the industry’s need for support in expanding its reach, fostering local businesses, and driving sustainable growth in 50 select destinations. With these measures, we look forward to seeing a more vibrant hospitality ecosystem that will benefit both businesses and the communities they serve.
Rahul Taneja, Head of Operations, Dharana at Shillim
FM Sitharaman’s Union Budget presents a transformative vision, accelerating economic growth while empowering citizens. A standout feature is its strong emphasis on the travel and hospitality industry, with well-structured measures to boost both domestic and international tourism.
Key initiatives including promoting spiritual and medical tourism, along with the Heal in India initiative, will be a game-changer. By collaborating with the private sector and simplifying visa norms, the budget paves the way for India to become a premier destination for holistic wellbeing, integrating Preventative Medicine, Physical Restoration, Healing Nutrition, Emotional Balance, Spiritual Harmony and Ayurveda into a unified growth strategy. This aligns perfectly with Dharana at Shillim’s holistic pathways.
The implementation of streamlined e-visa facilities and visa-fee waivers for select groups will encourage inbound travel, positioning India as a more accessible and desirable destination for global tourists.
Additionally, skill-development programs, particularly in Institutes of Hospitality Management, will equip the youth with world-class training, fostering individual growth and raising the overall standard of hospitality services. These efforts will enhance customer experiences and strengthen India’s reputation in the global travel industry.
Navneet Nagpal, Princpal Consultant and Director, Spectra Hospitality Services
This year’s Union Budget marks a significant turning point for India’s tourism sector, particularly in attracting foreigntravelerss—a segment that has long needed greater focus. The introduction of visa-free access for select countries and streamlined e-visa processes will play a crucial role in enhancing inbound tourism, positioning India as a more accessible and attractive global destination.
The announcement of 50 key destinations to be developed under the challenge mode is a transformative step. By curating world-class experiences and investing in infrastructure, India can strengthen its appeal as a premier hub for leisure, heritage, and experiential tourism. Additionally, the renewed emphasis on Buddhist Circuit tourism is a strategic move to boost footfall from Southeast Asian countries, tapping into an underutilized yet high-potential market.
Equally important is the government’s focus on skill development through IHMs and financial support for homestays via Mudra loans. These initiatives will not only elevate service standards but also create meaningful economic opportunities at the grassroots level, fostering a more inclusive tourism ecosystem.
With this renewed strategic push for foreign tourism, India’s hospitality sector is poised for accelerated growth, increased revenue generation, and a stronger presence on the global tourism map. The emphasis on public-private partnerships (PPP) and incentive-linked support for tourism infrastructure further strengthens the industry’s long-term sustainability and competitiveness.
Vishal Vincent Tony, Managing Director of Ayatana Hospitalities Private Limited
The Union Budget 2025 marks a significant step forward for India’s tourism and hospitality sector. The government’s emphasis on regional connectivity, infrastructure development, and sustainable tourism will not only enhance travel experiences but also drive economic growth.
The expansion of the UDAN scheme to 120 new destinations will improve accessibility to emerging travel hubs, unlocking new opportunities for experiential tourism. Additionally, Mudra loans for homestays will empower local communities and promote unique, culture-driven hospitality. The initiative to develop 50 key tourist destinations in partnership with states is a welcome move, ensuring that India’s most iconic and emerging locations receive the attention they deserve.
With a strategic focus on spiritual and medical tourism, along with e-visa facilitation and visa fee waivers for select countries, India is poised to strengthen its position as a global travel destination. The commitment to employment-led growth in tourism will further benefit the industry by creating new opportunities and fostering long-term development.
Rajesh Magow, Co-founder & Group CEO, MakeMyTrip
The Finance Minister’s announcements reflect a clear intent to harness the potential of travel and tourism sector by prioritizing infrastructure, improving access, incentivizing investment, and expanding its reach beyond established hubs.
Strengthening regional connectivity through the modified UDAN scheme will unlock new corridors of travel, bringing deeper parts of India into the tourism fold. The 50-year interest-free loan to state governments will drive infrastructure development at the destination level, thereby contributing to the tourism growth story.
The challenge-mode approach to developing 50 destinations, backed by performance-linked incentives, shifts the focus to outcome-driven execution—encouraging states to compete and innovate in destination management.
Equally important is the structured push for hospitality. Including hotels in the harmonized infrastructure list across 50 destinations will unlock long-term financing and drive investment, while extending Mudra loans to homestays ensures that smaller entrepreneurs and local communities are equally part of this growth story.
Prashant Sachan, Founder and CEO, AppsForBharat
The Union Budget 2025-26, presented by Hon. Finance Minister Smt. Nirmala Sitharaman, recognizes the profound spiritual and cultural significance of Bharat. We welcome its continued efforts in introducing initiatives such as the challenge-mode approach for developing 50 tourism hubs, Mudra loans for homestay businesses, enhanced regional connectivity through the modified UDAAN scheme, and outcome-driven infrastructure development for states. These efforts, combined with harnessing the immense potential of technology and innovation, provide the necessary impetus for creating a Viksit Bharat.
The renewed ₹10,000 crore commitment for AIFs supporting Indian startups, along with a strong emphasis on upskilling and AI integration in education, marks a significant step toward positioning India as a global innovation hub. It will be exciting to witness these initiatives materialize in the future, driving innovation and advancing our vision of an Atmanirbhar Bharat.
Vikram Kamat, chairman of VITS KAMAT Group
The 2025 Union Budget brings strong momentum for the hospitality and tourism sector, with infrastructure status for hotels in the top 50 tourist destinations being a significant step forward. Easier financing and increased investment will help scale hospitality standards and create world-class accommodations in key locations.
The focus on homestays through MUDRA loans is equally promising, as it empowers small entrepreneurs while offering travellers more authentic and locally immersive experiences. The push for skilling through five National Centres of Excellence, particularly in hospitality, ensures that India’s workforce remains competitive on a global scale.
While these initiatives lay a solid foundation for growth, addressing GST input credit for hotels and structured tax benefits could further strengthen the sector’s ability to expand and thrive. A more holistic approach to financial and policy support would help accelerate India’s position as a global tourism hub, and we look forward to continued collaboration to shape a more incredible future for hospitality.
Jyoti Mayal, chairperson of the Hospitality and Skill Council
The 2025 Union Budget lays a strong foundation for India’s travel and tourism industry, with some much-needed initiatives that will shape its future. Expanding the UDAN RCS scheme to 120 destinations and targeting 4 crore travellers is a crucial step in making regional connectivity more seamless, bringing previously overlooked destinations into the tourism mainstream. Developing 50 key tourism sites in partnership with states, along with granting infrastructure status to hotels in these destinations, is a progressive move that will boost investment, create jobs, and elevate the overall travel experience.
The focus on medical tourism under the ‘Heal in India’ initiative, along with streamlined visa norms and private sector collaboration, is another strong push in positioning India as a global hub for wellness and healthcare tourism. Similarly, incentives such as MUDRA loans for homestays, performance-linked incentives for states, and e-visa fee waivers for select groups will support local businesses, enhance accessibility, and attract a wider spectrum of travelers.
The announcement of five National Centres of Excellence for Skilling, including dedicated support for hotel management training, is a major win for the industry. Tourism thrives on people, and ensuring our workforce is equipped with world-class skills in hospitality, digital innovation, and sustainable tourism practices will significantly enhance service standards while creating more employment opportunities.
However, given the strides being made, it is a setback that critical concerns raised by travel service providers — such as restoring GST input credit, abolishing TCS, and granting industry status to tourism for tax benefits, have not been addressed. These measures are essential for improving ee of business, boosting liquidity, and ensuring the long-term sustainability of the sector.
The ₹33 crore allocation for international tourism marketing, while a significant jump from last year’s ₹3 crore, still pales in comparison to the ₹177 crore allocated for domestic tourism promotion. If we truly want to position India as a premier global travel destination, we need a stronger push in international branding and outreach.
This budget is undoubtedly a step in the right direction, reinforcing tourism’s role as a key economic driver. But to truly unlock its potential, there is a need for more industry-centric reforms that provide long-term support and financial ease for businesses across the ecosystem.
Kush Kapoor, CEO, Roseate Hotels & Resorts
The Union Budget 2025 presents a forward-thinking approach that is bound to benefit the hospitality and tourism sector significantly. The announcement of visa waivers for select foreign tourist groups will undoubtedly make India a more accessible and attractive destination for global travelers. The provision of Mudra loans to support homestays is a commendable step toward boosting grassroots tourism and encouraging local entrepreneurship. These measures will not only enhance travel experiences but also strengthen community-driven hospitality ventures.
Moreover, the tax exemption for upto Rs 12 lakh income, and the resulting relief for a large section of the population are game changers for the industry. With higher disposable incomes, people are likely to increase their spending on travel, dining, and leisure experiences. This boost in discretionary spending will drive demand across hotels, restaurants, and other tourism-related businesses. The government’s thoughtful initiatives will contribute to bolstering consumer confidence and ultimately play a significant role in the growth of the hospitality sector and the nation’s economy as a whole.
