Pre-Budget Expectations: Union Budget 2026-27

"The approaching Union Budget has a strong opportunity to further strengthen India’s travel and tourism ecosystem through focused interventions that promote ease of access, visibility and local employment.

To attract a new traveller demographic and promote balanced regional growth, we must identify new destinations, especially across the North and North East. This can be supported by improved connectivity under the UDAN scheme, which will also facilitate sustainable shifts by redirecting crowds away from prime destinations.

India is well positioned to boost nature-centric travel. So, a calibrated relaxation of wildlife sanctuary guidelines - while adhering to strict conservation norms -will further support sustainable, future-ready tourism development.

Simplified visas for health and wellness tourism can further catalyse this robust, high-demand segment. Extending the PRASAD scheme to more destinations, along with ensuring timely completion, can play a critical role in enhancing pilgrimage and heritage travel circuits. Additionally, a targeted policy push for cruise tourism along India’s extensive coastline can also significantly enhance India’s global competitiveness in the sector.

Safety and ease of travel remain critical. So, a dedicated focus on tourism police under police modernisation schemes is essential.

Finally, support for rural cooperatives as well as sustained investment in skill development and local employment generation (particularly in rural and emerging destinations) will enable participative tourism models that directly benefit local communities."

“As India enters the next phase of its tourism growth story, the upcoming Union Budget presents an important opportunity to further strengthen travel and hospitality as long-term economic enablers. Over the past few years, rising domestic travel, improving air connectivity and a growing preference for experiential and sustainable stays have created strong momentum across the sector, particularly beyond the metros.

From an industry perspective, continued focus on infrastructure development including last-mile connectivity to emerging destinations will be critical in unlocking the full potential of tier II and tier III markets. Enhanced support for destination-led tourism, convention infrastructure and regional air routes can further accelerate demand while creating local employment and entrepreneurship opportunities.

Hospitality is also a capital-intensive sector and measures that improve access to long-term financing at competitive rates would meaningfully support new hotel development and asset upgrades. Rationalisation of taxes and clarity on GST treatment for hospitality services would help improve operational efficiency and enable businesses to reinvest in quality, technology and people. Equally important is the growing emphasis on sustainability. Incentives for energy-efficient buildings, renewable energy adoption and water management will encourage responsible growth and align the sector with India’s broader climate commitments. As a brand deeply committed to environmentally conscious hospitality, we see sustainability not as a cost but as a competitive advantage.

Overall, a balanced policy framework that combines infrastructure creation, ease of doing business and sustainability-led incentives can help position Indian tourism and hospitality as a resilient global growth engine in the years ahead.”

"Ahead of the 2026 Union Budget, one of the most important expectations for the co-living and student housing sector is clear and unambiguous guidance on GST applicability. Recent rulings have suggested that rent paid to landlords and charged to end customers should be exempt from GST, and it is critical that this position is formally codified and implemented uniformly across the country.

Co-living and hostel pricing is already shaped by high capital expenditure, rental costs, and location-specific economics. Any ambiguity around GST creates market distortions, leading to inconsistent pricing practices among operators and directly affecting affordability for students and young professionals.

A clearly defined 0% GST framework across the entire value chain, covering both landlords and end customers, would significantly improve transparency, standardisation, and trust within the sector. More importantly, it would help unlock new supply, raise living standards, and support India’s growing population of mobile students and young professionals.

Such clarity would be a meaningful step toward improving ease of living and enabling more organised, sustainable growth in urban India—ultimately contributing to higher productivity and better outcomes for the country’s youth."

Surendra Chand
Director of Finance – Novotel Ahmedabad

As Novotel Ahmedabad enters the next financial cycle, our budgeting framework has been shaped through a combination of market-driven intelligence and property-level growth objectives. From the perspective of the finance function, Ahmedabad’s hospitality environment continues to present expanding opportunities, supported by sustained corporate demand, robust medical tourism, an increasingly active MICE segment, and enhanced connectivity driving both domestic and international travel into the city. This backdrop reinforces a more ambitious financial stance for the coming year.

Novotel Ahmedabad has planned a budget that is approximately 20% higher than last year. This increase is a strategic decision rooted in our expansion plans, operational vision, and the evolving market dynamics of Ahmedabad. The introduction of our new Specialty Restaurant stands out as one of the key investments under this plan. Specialty dining has become an important differentiator for upscale hotels, influencing guest satisfaction, footfall beyond resident guests, and incremental F&B revenue. For us, this addition requires targeted allocations across procurement, guest experience programming, staffing, and culinary marketing, ensuring that the outlet has a strong market debut supported by long-term visibility.

Alongside this expansion, Novotel Ahmedabad remains focused on strengthening its brand voice within the local and national hospitality space. Ahmedabad is today considered a high-potential Tier-II market with rapid growth across multiple demand segments. Corporate travel continues to gain traction, driven by project-based movement from manufacturing, EPC, IT, and pharmaceutical sectors. At the same time, medical tourism is contributing to steady long-stay demand, fuelled by the city’s healthcare ecosystem of leading hospitals and specialty clinics. Government and political delegations linked to infrastructure projects and state-level initiatives also form an important segment, requiring specialized operational coordination and elevated service preparedness.

Large-scale events further amplify the city’s hospitality potential. The upcoming ICC Men’s T20 World Cup, Medical Expo India 2026, and ASICON 2026 highlight Ahmedabad’s emergence as a credible event and convention host. Such events create surges in room demand, banqueting requirements, and media visibility, while also stimulating international exposure. Our financial outlook includes provisions for marketing collaborations, event partnerships, and capability enhancements aligned with this growing MICE and sports-tourism landscape.

The external policy environment also shapes budgeting expectations. The hospitality sector is aligned in advocating for infrastructure status for hotels, GST rationalization—especially for F&B—and the restoration of Input Tax Credits (ITC), all of which would significantly improve financing access and operating margins. Additional expectations include stronger tourism infrastructure spending and incentives for sustainability and technology adoption.

Within this larger ecosystem, Novotel Ahmedabad’s enhanced budgeting strategy reflects confidence in the city’s hospitality trajectory and commitment to strengthening our operational capability, guest offerings, and brand presence. As Director of Finance, the approach remains clear: allocate with intent, invest where value compounds, and ensure the property is well-positioned to capture the next phase of Ahmedabad’s hospitality growth.

Dushyant Mishra

"For much of the past decade, the hospitality and events industry has navigated a landscape defined by caution. Budgets were reactive, shaped by uncertainty, and often focused on short-term survival rather than long-term vision. As we enter 2026, that narrative is shifting decisively. Across global markets,and notablywithin India, budget expectations are rising with confidence, signaling a new era where experience, quality, and brand value take center stage.

The Global Pulse: Experience as Currency

Hospitality worldwide is increasingly measured not by scale, but by the richness of experience. Guests and clients are seeking immersive formats, curated culinary journeys, and seamless service delivery that leave lastingimpressions.This evolution is not confined to luxury markets; it is becoming the benchmark across corporate events, weddings, and social celebrations.

India's Transformation: Sophistication Meets Intent

India's hospitality sector mirrors this global trajectory, but with its own distinctive momentum. Corporate gatherings are more strategic, weddings more curated, and social celebrations more design-led than ever before. The market is maturing rapidly, with clients demonstrating a clear willingness to invest in:

• Differentiated menus and premium beverage programs

• Technology-backed operations that elevate efficiency and guest satisfaction

• Venues that combine strong aesthetics with consistent quality delivery

Purpose Over Scale

The defining shift in 2026 is that budgets are no longer about "how big" but "why." Clients are prioritizing purpose-driven investments, allocating resources to elements that reinforce brand identity, enhance guest experience, and deliver measurable long-term value.

Meanwhile, operators are rethinking cost structures, embracing smarter efficiencies that allow elevated experiences without disproportionate spending.

Looking Ahead: Confident Growth Anchored in Value

The outlook for 2026 is clear: steady, confident budget growth. Global benchmarks are setting the tone, but India's rapidly evolving, experience-driven market is amplifying the momentum.

Hospitality leaders who align with this shift, balancing innovation with financial prudence, will not

only meet client expectations but redefine them.

 The industry is enteringa phase where memorable experiences are the new ROI. Those who invest with clarity and intent will shape the future of hospitality, setting standards that resonate far beyond 2026."

Louis D’Souza

"As luxury and experiential travel from India continues to gain momentum, the Union Budget can play a pivotal role in shaping both outbound and inbound travel sentiment. On the outbound side, high-spending Indian travellers are increasingly investing in curated, design-led experiences, but policies around TCS and forex costs continue to influence booking timelines and destination choices. Easing these financial frictions would boost travel confidence and encourage travellers to upgrade experiences rather than compromise on quality. Equally important is the opportunity to strengthen India’s inbound tourism narrative. With global travellers seeking authentic, immersive journeys, India’s rich cultural heritage, wellness offerings, luxury hospitality, and emerging experiential circuits are uniquely positioned to attract high-value inbound travellers. Strategic budgetary support for destination marketing, infrastructure upgrades, simplified visa processes, and enhanced connectivity can significantly elevate India’s appeal as a premium travel destination. A forward-looking budget that balances international mobility with strong inbound promotion will not only drive foreign exchange earnings but also create employment across tourism ecosystems. By supporting innovation, storytelling, and seamless travel experiences, the Budget can position India as both a confident outbound market and a compelling inbound destination for discerning global travellers”. 

Leena Jhugroo

"As India’s outbound travel market matures, the Union Budget presents an opportunity to unlock sustained long-haul leisure growth. A key expectation from the industry is rationalisation of TCS on overseas tour packages and forex spends, which continues to impact travel affordability and decision-making for Indian consumers. While demand for experiential and premium travel remains strong, especially among honeymooners and high-net-worth travellers, cost sensitivities can delay or dilute travel plans. For island destinations like Mauritius, which are positioned around romance, luxury, wellness, and MICE, easing outbound travel costs would significantly boost bookings. Improved forex policies and incentives for international travel-linked services would further encourage longer stays and higher spends. With Indian travellers increasingly seeking bespoke, slow-travel experiences over short holidays, supportive policy measures can strengthen India’s position as a key source market for island economies and help destinations like Mauritius sustain year-round demand across leisure and corporate segments.”.

"India continues to be one of the most important and consistent source markets for Sri Lanka, driven by strong cultural ties, short travel time, and a growing appetite for nearby international destinations. Indian travellers today are exploring Sri Lanka across diverse segments, including family holidays, wellness retreats, cultural tourism, destination weddings, and corporate offsites. As the travel ecosystem evolves, policies that enhance ease of travel, cost transparency, and regional connectivity can play a meaningful role in encouraging more frequent visits and longer stays. Improved air connectivity and tourism-friendly measures will further strengthen bilateral travel flows. With Indian travellers increasingly seeking destinations that offer value, diversity, and immersive experiences, Sri Lanka is well-positioned to benefit from this sustained outbound momentum from India.”

"The Upcoming Union Budget presents yet another opportunity to further strengthen India's travel and tourism sector. Reducing indirect taxes would increase affordability, boost global competitiveness, and encourage tourism. Such actions would promote long-term value, employment generation, and steady growth throughout the hospitality ecosystem. At the same time, the government should assign funds for improving tourism infrastructure and facilities for domestic and international travelers. Industry status is long overdue demand for hospitality sector, which generates enormous foreign exchange and provides employment to crores of people."

"As we look ahead to the Union Budget 2026, the online hotel and alternative accommodation booking ecosystem is playing an important role in supporting India’s domestic and destination-led travel growth. With hotel occupancies improving and demand for homestays and BnBs rising across Tier-II and Tier-III cities, continued policy support can help sustain this momentum.Further GST rationalisation on hotel rooms, especially in the mid-scale segment, would help keep travel affordable for consumers, while also ensuring price consistency across hotels and alternative accommodation providers. Supportive measures for the hospitality sector can also encourage better quality stays across destinations.

As a travel-tech platform like Holy Hotels, focused on simplifying hotel and BnB bookings and preparing to expand into flight bookings, we expect the government to support digital travel platforms, integrated booking experiences, and skill development across tourism services. These steps would enhance customer choice, improve transparency, and contribute to a smoother, more accessible travel experience for Indian travellers."​

At Courtyard by Marriott Pune Chakan, budgeting is approached as a forward-looking and purposeful exercise—one that balances insight, collaboration, and opportunity. Rather than being a routine financial process, it is seen as a moment to pause, evaluate performance, understand market signals, and prepare for what lies ahead. Inputs from teams, guest feedback, market trends, and evolving demand patterns all come together to shape a well-rounded and realistic outlook.

This approach translates into aligning budgets with business intent. The focus begins with a clear understanding of the top-line inflow we aim to achieve, followed by thoughtful allocation of resources where they can drive the strongest returns—both commercially and experientially.

“We look at budgeting as a living process. It starts with the revenue we aspire to generate and evolves based on guest feedback, operational priorities, and market movement. What guests tell us, directly and indirectly, plays a big role in where we choose to invest.”

The budgeting lens also remains sensitive to external factors such as competitor activity, new hotel openings, and shifting guest expectations. This ensures that decisions remain relevant, timely, and balanced—supporting both property upkeep and sustainable profit generation.

This integrated, anticipative approach allows Courtyard by Marriott Pune Chakan to remain agile, guest-focused, and commercially strong in a competitive hospitality landscape.

Balaji M

Vishal Vithal Kamat

Executive Director at Kamat Hotels India Ltd  

"We have strong expectations from the Union Government to enhance budgetary allocations for the hospitality sector as a whole. Hospitality extends beyond hotels to include tour operators and a wide network of allied services that collectively drive tourism and employment. The industry has long been seeking targeted benefits and policy support to streamline operations, improve ease of doing business, and strengthen India’s tourism ecosystem. We are hopeful that the forthcoming budget will address these long-standing concerns in a meaningful way."

Elton Rodrigues 

Director, HostMyTrips

“As the Union Budget 2026 approaches, the travel and tourism sector looks forward to policies that can further strengthen domestic tourism in India. One of the key areas that needs attention is tourism infrastructure development. Better roads, improved rail and air connectivity, and enhanced facilities at tourist destinations can make travel easier and more affordable for Indian travellers.Another important expectation from the Budget is greater clarity on GST rules for hotel room tariffs, especially since pricing often fluctuates based on demand and seasonality. Clear and practical guidelines will help reduce confusion for both hotels and travel platforms, ensure fair taxation, and allow businesses to adopt flexible pricing without compliance challenges.With focused investments in infrastructure and simplified GST regulations, the government can create a more supportive environment for the tourism industry.”

Darshan Shah 

Managing Director, Harkesh Rubber LLP

In manufacturing sector, where continuous machinery upgrades and technology adoption are essential, higher depreciation allowances can accelerate modernization, improve productivity, and strengthen quality standards, helping Indian manufacturers compete globally. Additionally, consistent policy support for MSMEs, easier access to finance, and incentives linked to manufacturing efficiency will be crucial in strengthening India’s industrial base and enabling sustainable long-term growth.”

 Priyanka Jain

Co-founder and Director Marketing, Snow World Entertainment

“We are hopeful that the upcoming Budget will support the continued growth of the entertainment, gaming, and hospitality sectors. Thoughtful tax measures and enabling policy initiatives can help businesses operate more efficiently while encouraging greater consumer participation in experience-led offerings. Continued focus on experiential entertainment, gaming, and the food and beverage industry will contribute to job creation and further strengthen India’s leisure and lifestyle economy.”

Sreeram Gangadharan

Co-founder and Partner , Maverick & Farmer (GoodFarmer Food)

 “As we head into the Budget, one of the key asks from the organised café and hospitality sector is clarity and parity on GST input credits. While food and beverage outlets continue to charge 5% GST, the inability to fully claim the 18% GST on capital good purchases significantly impacts cost structures and cash flows, especially for growing brands. A more rational GST framework will not only lower operational friction but also help Indian café brands scale responsibly while keeping consumer prices accessible.”

K Ramesh

Chief Financial Officer, Niramaya Life Private Limited / Himalia Prime Assets Private Limited

"India stands at a pivotal moment to strengthen its position as a global wellness tourism destination. With a growing international demand for preventive healthcare, holistic wellness, and sustainable travel, the upcoming Union Budget presents an opportunity to create a supportive policy framework that enables long-term growth of this sector.

From a wellness-led hospitality perspective, one of the key expectations is GST rationalisation for wellness and health tourism services. Wellness retreats offering Ayurveda, Yoga, naturopathy, and lifestyle correction currently fall under taxation frameworks similar to luxury hospitality. Recognising these services under a separate, concessional GST slab—particularly for notified wellness and health tourism packages—would significantly enhance affordability and global competitiveness, especially for foreign tourists seeking long-stay preventive care in India.

Another important area is income-tax incentives for wellness tourism projects. Introducing a time-bound tax holiday or profit-linked deduction for notified wellness and preventive healthcare infrastructure would encourage fresh investments and expansion into semi-urban and rural destinations, creating employment while supporting public health outcomes.

Given the sector’s strong alignment with sustainability, accelerated depreciation for green and energy-efficient assets would be a meaningful policy measure. Wellness resorts invest heavily in renewable energy, water conservation, waste management, and eco-sensitive construction, and higher depreciation allowances on such assets would incentivise greener operations.

Access to long-tenure, affordable financing is equally critical. Preferential credit support or interest subvention for wellness and sustainable hospitality projects would ease capital constraints and accelerate responsible development.

Collectively, these measures would not only strengthen India’s wellness tourism ecosystem but also support national priorities of sustainable growth, foreign exchange generation, and preventive healthcare."

Ishaan Dodhiwala 

"The medical tourism sector expects the Union Budget 2026–27 to respond to the growing global demand for India’s ‘Heal in India’ initiative, as international patients increasingly seek affordable, high quality and outcome driven healthcare.

We expect the government to allocate a specific budget to promote ‘Heal in India’ initiative in the priority markets like Africa, middle east, SAARC and other emerging markets to promote medical tourism to India.  Besides we expect specific measures to ease medical visa processes, support internationally accredited hospitals, and expand quality healthcare facilities into Tier II and Tier III cities.

As demand for complex procedures and treatments such as cardiology, oncology, orthopaedics and  fertility care continues to rise, expectations also include policies that attract foreign capital and strategic partnerships, along with rationalisation of import duties on advanced medical equipment and incentives for digital health and AI enabled diagnostics.

Overall, the sector expects the Union Budget 2026–27 to scale the Heal in India initiative into a globally competitive medical value travel framework by combining affordability, clinical excellence and sustained global investment.”

“As the Union Budget approaches, the imported alcobev sector is looking less for concessions and more for clarity, consistency, and transparency. Today, imported spirits operate within a highly fragmented framework with tariffs at the central level and excise structures varying sharply across states. A move toward greater standardisation of duties and clearer classification norms would go a long way in improving price predictability, compliance and ease of doing business for both international brands and Indian partners. The recent progress on trade discussions with the European Union, including proposed tariff rationalisation on certain alcoholic beverages, is a welcome signal. Extending similar balanced trade engagement to other producing regions, such as Mexico, the home of tequila, would further align India with global best practices while supporting a growing premium consumer segment. Tequila, in particular, is seeing strong interest in India’s urban markets, driven by premiumisation and lifestyle shifts. Consumers are increasingly seeking transparency in provenance, ingredients and production trends that favour well-regulated, quality-led categories. From a Budget standpoint, policy coherence across tariffs, state duties and taxation mechanisms, along with predictable regulatory processes, would help the sector grow responsibly while ensuring sustained revenue for governments and wider consumer choice.”

Pranav Rungta

Cofounder and Director of Nksha Restaurant and Vice President of NRAI Mumbai.

“The hospitality and food services sector is at a critical inflection point. Revisiting the GST notification on commercial leases under the Reverse Charge Mechanism would provide much-needed relief to operators already managing tight cash flows. Reintroducing support mechanisms like SEIS can also strengthen restaurants that contribute to foreign exchange earnings. What the industry truly needs is targeted subsidies, easier access to debt for SMEs and formal recognition through industry status, considering its significant role in employment generation. A dedicated food services ministry, along with structured employee welfare initiatives, would go a long way in building a more resilient and sustainable ecosystem.”

Siddhartha Gupta

Chief Executive Officer, Yatra Online

"India’s travel and tourism sector has reached an inflection point, we have finally surpassed the peaks of 2019 (Pre-Covid) both in domestic and international traveler count, hence can safely say, demand is no longer the constraint. Our challenge for future will be about how effectively the ecosystem is structured to scale in a sustainable and predictable manner. With travel demand now broad-based across segments and geographies, the opportunity lies in moving from growth driven by volume to growth anchored in institutional strength and long-term value creation.

Last year’s Budget rightly emphasized destination development and regional connectivity. The focus should continue to be on how efficiently this intent translates into execution on the ground. 

From the upcoming Budget, the industry is looking for a clear and stable framework that improves affordability for travelers, simplifies taxation and compliance across the travel value chain, and enables long-term investment in connectivity and destination ecosystems. These factors determine how confidently travel businesses can invest and how consistently consumers can access travel.

There is also a strong case for viewing travel not merely as a consumption category, but as a strategic enabler of economic activity.

Every improvement in ease of travel has a cascading impact on employment, MSMEs and regional development. Strengthening connectivity and destination readiness across Tier II and Tier III markets will be critical to unlocking the next layer of domestic growth, while also improving India’s competitiveness as a global destination.

A forward-looking Budget that balances consumer affordability with ecosystem-level growth can unlock the next chapter of India’s travel story, positioning travel as a durable driver of jobs, enterprise and services-led growth."

“While the hospitality sector is witnessing robust operating performance driven by strong travel demand, returns on investment remain under pressure due to the industry’s capital-intensive nature and prohibitive acquisition costs.

Introducing tax incentives on capital expenditure and granting the long-awaited infrastructure status would provide a significant boost. This would unlock access to long-term institutional credit at competitive repo-linked or international benchmark rates, thereby easing the cost of capital and fuelling sustainable growth.

Furthermore, to bridge the widening skills gap, we look forward to enhanced policy support for government-led manpower development and training initiatives. Simultaneously, strengthening aviation connectivity and expanding the domestic airline network remain vital to unlocking new travel corridors and reinforcing India’s position as a premier global tourism destination.”

“The coming year presents an important opportunity for India’s hospitality sector to scale sustainably while deepening its contribution to tourism-led economic growth. Entering 2026, demand is being driven by experiential travel, destination weddings and wellness-led stays, creating the need for policy support that encourages long-term, quality-led investment. Reforms such as granting tourism industry status, rationalising GST and improving access to infrastructure and green financing can meaningfully strengthen the sector. For destinations like Jaipur, targeted budgetary support for tourism infrastructure, heritage-sensitive development and sustainable hospitality projects will help enhance global competitiveness while preserving cultural identity and driving inclusive growth.”

"India’s outbound travel market is entering a new phase of global expansion, and Budget 2026 has an important role to play in enabling this growth,”. “For destination specialists like Turalux, which curate immersive travel and MICE experiences in Georgia, policy stability, streamlined foreign exchange norms, and seamless cross-border digital payment systems are key enablers. We expect the Budget to support international travel facilitation, improve ease of doing business for Indian tour operators operating overseas, and encourage structured outbound tourism through regulatory and financial clarity. As Indian travellers and corporates increasingly seek experiential destinations beyond traditional hubs, emerging markets like Georgia are witnessing strong demand for cultural, adventure, and incentive travel. Budget 2026 can empower Indian travel companies to scale globally through easier overseas operations, global marketing partnerships, and robust digital booking ecosystems—positioning India not just as a source market, but as a globally respected travel solutions provider.”

“The government’s decision to raise the LRS TCS threshold to ₹10 lakh has meaningfully reduced the upfront tax burden on outbound remittances.

However, there remains a need to rationalise the tax treatment across international spending instruments. Forex cards, which are purpose-built for overseas travel and offer transparent, pre-loaded exchange rates, continue to attract TCS beyond the threshold, while international credit card spends remain outside the TCS ambit. This creates an uneven playing field between instruments used for the same purpose and often nudges consumers towards opaque pricing structures with hidden markups.

While TCS is adjustable at the time of filing returns, the upfront cash outflow continues to impact travellers’ liquidity. As outbound travel from India continues to grow, a harmonised and clearly defined TCS framework across international payment instruments would promote transparency, simplify compliance, and ensure fair treatment for Indian travellers”.