- Date : 01/11/2018
- Read: 3 mins
If the rupee’s downfall continues, bookings in the upcoming year will slow down further. Read this in detail
One would naturally expect that the rupee falling against the US dollar would affect not just macroeconomic matters but also overseas education, food imports, gadget prices, and foreign vacations. Significantly, US travel bookings and visa numbers have been negatively impacted. If the rupee’s downfall continues, bookings in the upcoming year will slow down further.
Speaking to Livemint TravelMartIndia.com Chairman and CEO Manoj Gursahani, said that the falling rupee could result in the cost of travel rising by 10-15%. By way of example, when the rupee was Rs 45 to a dollar, you paid Rs 90 for a $2 service. Let’s assume that the rupee falls in value to Rs 50 a dollar; you will now pay Rs 100 for the same $2 service.
What the numbers say
Two popular visa categories for Indians travelling to the US are B1 (business) and B2 (leisure). Booking agents and tour operators say this year’s visa issuance numbers are almost the same as the previous year’s. However, growth has decelerated to 5% instead of the expected 15%. If this situation persists it will have a negative impact on the numbers next year.
An Economic Times report quotes Sheema Vohra, Brand USA’s managing director for India, who is in constant touch with major tour operators, saying that there’s no significant impact. She also said that from 2016 to 2017 there was an increase in Indian arrivals by 6.5% and it continues to grow. The first quarter of 2018 also saw a rise in numbers.
Another report by Economic Times, quoting Karan Anand, head of relationships at Cox & Kings, states that although the numbers of visitors are not falling, there’s a trend to downtrade – say, picking four-star properties over five-star hotels or opting for indirect flights that are cheaper than direct flights. On the whole, this results in nearly 15-20% savings.
That dream vacation in the US is still achievable but budget-conscious travellers will have to take a hit. Overall, there is a visible change in travel patterns – choosing short-haul destinations, cutting holidays short, downtrading, etc.
The rupee’s drastic fall against the dollar is not something new; it’s the fourth time this is occurring this decade. According to a recent report by India Ratings, this fall stands at a five-year high and has been the worst in the past few years.
How to tide over the situation
Despite the fluctuations in currencies, Indians still schedule foreign travel in their agendas. Frequent travellers can adopt a more strategic spending tactic to decrease the effect on expenditure. Booking in advance and paying early helps to save a lot. While there is no reduction in price, being early ensures there’s no escalation in the cost.
Keep a buffer amount of 5-10% as it takes such fluctuations into account. Reducing the number of days of travel from 15 to 10 can help. Downgrading your hotel from a five-star to a three-star will ensure you spend within your limits. Curtailing expenses like shopping, dining out, entertainment etc. can help you build a fund for must-do experiences.
Group tours are another way to save money. Lastly, non-dollar destinations or alternative destinations like Eastern Europe over Western Europe, Thailand, Sri Lanka, Dubai, Bali, etc. are also good bets for a great vacation.