Cheap hotels, budget flights lure Indian tourists into the UAE

India Dispatch: With the rise of low-cost airlines and a growing number of affordable hotels, Dubai and the wider region are attracting travellers from the subcontinent in increasing numbers.

Indian tourists Vikram Mehta and his wife Priti buy jewellery, right, at a jewellery shop in the Gold Souk in Deira, Dubai. Pawan Singh / The National

Tony Thomas, 32, a driver from Kerala in India, has aspired to travel to Dubai for many years.

Mr Thomas thinks that now the trip might almost be within his grasp.

"Dubai's actually a nice place," he says.

"You've got some cheap hotels, cheap flights. The shopping festival would be the best time."

More and more cost-conscious Indians on a budget are travelling to the UAE, once largely considered a destination for the super-rich, as they take advantage of cheaper air fares amid an increase in the number of flights, as well as a wider variety of hotels.

In some cases, it is actually cheaper to fly to Dubai than it is to fly within India.

"Budget travellers who have not visited Dubai are eager to do so," says Iqbal Mulla, the president of the Travel Agents Association of India.

"Some do compare the rates between domestic destinations and Dubai and opt for the latter. There seems to be a good growth."

A total of 702,142 Indian guests stayed in Dubai's hotels in 2011, meaning it overtook the United Kingdom in terms of the number of tourists it provided, and it was in second place only to Saudi Arabia, according to figures from the Dubai Department of Tourism and Commerce Marketing.

This compared with about 529,500 Indian travellers staying in Dubai's hotels in 2009 and 638,100 Indian guests in 2010.

The number of tourists travelling abroad from India is expected to reach 50 million by 2020, according to the UN world tourism organisation.

With a population of more than 1.2 billion, rising spending power among the middle classes and a rapidly growing appetite for travel, UAE hotels and authorities have increasingly targeted India as a source market for tourists.

A surge in the number of flights and low-cost carriers flying into Dubai has fuelled this demand.

"We have seen the low-cost carriers actually expand their reach to a lot of close by destinations such as Dubai," says Tarique Khatri, a senior vice president at Cleartrip, an online travel company in India.

"Last year, we had SpiceJet, which started their operations in [June]. Indigo added frequency to Dubai. We also had Jet Airways increasing another daily flight to Dubai," he says.

"Capacity increased a lot and because of a surge of capacity you've seen a little bit of pressure on the average ticket value. The average ticket price, which used to be at around 21,000 [Dh1,421] to 22,000 rupees has been averaging at around 17,000 to 18,000."

The fact that Kingfisher Airlines' flights have been grounded since the beginning of October has also played a role in pushing up the cost of travel within India by air, making jetting off abroad seem more attractive.

"One of the factors was there was a withdrawal from Kingfisher," says Mr Khatri.

"There was a capacity crunch, so the prices went up. It really more made sense for people to look at nearby destinations which had an excess capacity and the pricing was within their reach of taking that trip abroad."

He says Dubai is often a popular option for Indians venturing abroad for the first time.

"Budget travellers will normally be single-city travellers who would go for single destinations and, for that, Dubai would be an ideal destination for them to go to.

"It's one of the closest international destinations for somebody travelling from India," he says.

"Secondly, it's got the familiarity for any Indian who goes there - you see a lot of Indians, which means that the communication barriers are pretty low."

Still, visas, which are required for Indians, as well as a refundable deposit of Dh1,000, add to the cost of a trip to Dubai.

Gaurav Sinha is the managing director of Insignia, a branding firm that specialises in travel. He points out budget travellers come from a wide variety of backgrounds.

"These 'value-seekers' are not just defined by socio-demographic profiling, they could come from higher-income groups too," he says.

"This segment is growing fast in India with airlines offering reasonably attractive value for people to travel overseas and hotels in Dubai have recognised the need to cater to this segment.

"We have more mid-segment hotels in the pipeline than luxury resorts and that's addressing the value proposition and making Dubai more accessible to inbound tourism from India and Asia," he adds.

"Somebody may have been travelling once in every two years or once in a year but now, with the budget travel options available, he can travel maybe two or three times a year," says Promoth Manghat, the vice president of global operations for UAE Exchange.

"Sometimes the deals which the airlines are offering are very compelling."

It is not only tourists from India but business travellers as well who are increasingly opting for cheaper travel solutions, Mr Manghat adds.

"The option for airlines like flydubai were not in the picture not so long ago. Five years back we didn't have these airlines," he says.

"The traveller has now got plenty of choice."