A spectacular event on January 22nd, Prime Minister Narendra Modi inaugurated the grand Ram temple at Ayodhya, marking a significant moment in India’s religious and cultural history. However, the impact of this momentous occasion extends far beyond the realms of spirituality, as a recent report by global brokerage firm Jefferies suggests a potential Rs 85,000-crore makeover that could unlock India’s tourism potential.
According to Jefferies, the Ram temple has the power to draw over 50 million tourists annually, ushering in a new era of economic growth and development for Ayodhya. The report highlights the anticipation of a massive influx of pilgrims, with the temple’s vast expanse, spread over nearly 70 acres, poised to host about a million devotees simultaneously. Jefferies projects a surge in daily pilgrim numbers to the tune of 1-1.5 lakh, showcasing the temple’s potential to become a major pilgrimage site.
What sets Ayodhya apart is not just its religious significance but the comprehensive makeover it is set to receive. The proposed Rs 85,000-crore investment encompasses a range of infrastructural improvements, including a new airport, revamped railway station, township development, and enhanced road connectivity. Jefferies suggests that this massive makeover will have a multiplier effect, stimulating economic activities such as the construction of new hotels and other essential services.
Jefferies underlines the dominance of religious tourism in India, with several existing religious centers attracting millions of annual visitors despite infrastructural challenges. Ayodhya, with its improved connectivity and infrastructure, is poised to create a substantial economic impact, transforming from a quiet town to a global religious and spiritual tourist hotspot.
The economic ripple effect is expected to touch various sectors, with hotels, airlines, hospitality, FMCG, travel ancillaries, and cement standing to benefit significantly. The Rs 1,800-crore Ram temple, set against the backdrop of increased economic and religious migration to Ayodhya, is anticipated to be a catalyst for growth in these sectors.
Tourism is a key contributor to India’s GDP, and the industry is projected to grow at an 8% CAGR, reaching $443 billion by FY33. Despite its significant contribution, the tourism to GDP ratio in India is currently at 6.8%, placing it below many large emerging and developed economies. Jefferies sees the potential for Ayodhya to bridge this gap, with the temple serving as a strategic first-mover advantage in the religious and pilgrimage tourism space.
The report also sheds light on the proactive steps taken by various businesses to tap into Ayodhya’s emerging potential. Indigo, for instance, has declared Ayodhya as its 86th domestic destination with direct flights from major cities, while Air India, SpiceJet, and Akasa Air have announced flights connecting Ayodhya to multiple cities. Even the Indian Railway Catering and Tourism Corporation (IRCTC) has introduced tour packages to Ayodhya, reflecting the growing interest and demand.
Jefferies identifies potential beneficiaries across different sectors, with Indian Hotel Company and EIH in the hotel space, and ITC, Jubilant Foodworks, Britannia Industries, Godrej Consumer, Westlife Foodworld, Hindustan Unilever, Devyani International, and Sapphire Foods in the FMCG and QSR space. InterGlobe Aviation (Indigo), SpiceJet, IRCTC, and Ease My Trip are seen as potential winners in the travel sector.
As Ayodhya undergoes this massive transformation, the synergy between religious significance and economic opportunities presents a unique and promising landscape for investors and businesses alike. The Ram temple’s inauguration is not just a celebration of faith; it’s an invitation to explore the untapped potential of India’s tourism industry, unlocking opportunities for growth and prosperity in the heart of Ayodhya.