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Thailand’s tourism industry is struggling. Mainly because the number of Chinese tourists, which form a substantial percentage of international tourists visiting the country, has started to wane. Many hotels in Phuket, for instance, have reported a sharp decline in the number of bookings from Chinese guests.
Presently, Chinese tourists make up 28% of the total foreign arrivals in Thailand. Thailand’s tourism industry had been expanding at an impressive rate of 10% per year on growing inbound Chinese arrivals, but in the year 2018 a boat accident in Phuket killed dozens of Chinese. The incident along with a slowing economy at home, have both triggered a drop in the number of Chinese tourists in Thailand.
Chinese arrivals to Thailand could reduce further in the coming years as the Yuan weakens against the baht. The weakened Yuan as well as the fact that Thailand is not as cheap a tourist destination as it used to be, has all contributed in dwindling numbers for the country’s tourism sector.
On the other hand, bookings from India have begun to rise. “We are seeing a new growth from India. Indians are now driving industry growth like the Chinese had previously done,” says Kongsak Khoopongsakorn, Vice president of the Thai Hotels Association. In recent months Indian arrivals have accelerated due to more direct flights between Thailand and India, a visa waiver and most importantly, an increase in the number of outbound tourists from India.
According to an estimate, around 10 million tourists from India are now expected to arrive in Thailand by 2028, which is more than the five-fold increase on 2018 visits. Whereas, the visit of Chinese tourists, jumped from 800,000 in 2008 to more than 10 million last year.
In its latest move to attract more travellers from India, Thailand has now waived off visa fees for Indian travellers till April 2020.
Though China will remain an important market for Thailand, it is likely to offer Thailand less growth potential in the coming years. Meanwhile, India is set to become the new expansion story in Thai tourism, an industry that accounts for about 20 percent of the country’s gross domestic product.
In the next decade, Indian arrivals, currently at 4 per cent are forecast to surge to about 15 per cent of the total tourist arrivals in Thailand.
Indian tourists are inspired to look at Thailand as a tourist destination because of several reasons. Now, Indian and Thai cities are well connected with more direct flights. Tourists are drawn by Thai food and shopping and its beaches are emerging as significant and attractive destinations.
Pisit Puapan, Executive Director of Macroeconomic Policy Bureau of Finance Ministry has said, “The Indian inbound market could potentially rival that of China”, adding high growth from India has also helped offset a decline from other markets like Europe.
In the month of June this year, Thailand received about 180,000 Indian tourists, which is a record, the Tourism Ministry has reported last week. It also said that Indian visitors spend 11 percent more per trip than average foreign visitors.
Now, with the projection that India will overtake China as the world’s most populous nation in next eight years and its middle-class forecast to keep expanding, Thailand is cautious but also hopeful about the future of its tourism industry.
