Hotel Prices Go up in Major Indian Cities

2010 has been a particularly good year for the hotel industry of India, with the increase in both business and leisure tourism fueling a rise of hotel prices throughout the country. According to Hotels.com’s Hotel Price Index, the average price for a night spent in an Indian hotel was 2% higher throughout the country in 2010. Major cities such as Mumbai and New Delhi lead the trend with 7% and respectively 11% rates increase.

According to Hotel.com data, the average price for an Indian hotel reached 147 US dollars per night in 2010, with higher prices in popular cities (a one-night stay costs 173 US dollars in Mumbai and 158 US dollars in New Delhi). India is an exception for the Asia region, where hotel rates were 2% lower in 2010, although they still were 15% then in 2004 when the Hotel Price Index was introduced.

Prices in the region varied widely depending on current conditions. Thailand had lower prices due to political unrest in the country, while Singapore reported a boost led by a spike in corporate travelers and the launch of new tourist attractions. Major events, such as the World Expo in Shanghai, also caused hotel prices to go up.

While India benefited from a great year in what tourism is concerned, it is hard to predict what will happen in 2011. With millions being lost in the tourism industry due to poor hygiene and a severe lack of public toilets pointed out by the World Bank and announcements of price increases across the Indian travel industry, this Asian country still has a powerful attraction on travel companies: more hotels are being built and Expedia is eyeing this thriving touristic country. More recently, Berlin Tourism announced extensive efforts to establish direct flights between India’s Mumbai airport and Berlin.

What’s your take on the matter? Will India have another great year in travel or will they lose their edge due to overall higher prices and missing basic facilities for tourists?