Visa-free Thailand is attracting Indians by the hordes despite steep air fares

It's been just a month since Thailand started a “visa-free” regime for Indians and Indians are thronging Thailand like never before. Flights for the long weekend starting December 23 and returning on the first day of the new year are selling at over ₹50,000 from Mumbai and Delhi.

Fares are north of ₹60,000 from Bengaluru and Hyderabad. For a country which regularly benchmarks domestic airfares in peak season and compares it against those to Dubai, air fares to Thailand are climbing to new highs and in some cases double of those to Dubai.

India is the fourth top source market for tourism in Thailand after Malaysia, China and South Korea. Air India has already announced flights to Phuket from Delhi which start as a four times a week operation this week and increase to daily operations next month. The airline recently launched flights to Bangkok from Kolkata and has tied up with Bangkok Airways to fly passengers beyond Bangkok.

IndiGo adding flights

Airlines are also jumping on to the opportunity with IndiGo leading the way adding flights to Phuket from Mumbai and Bengaluru effective Jan 05 and Feb 28 next year respectively. This will take IndiGo’s Mumbai - Phuket frequency to 13 per week from the current seven and see the airline launch another route from Phuket. This also helps the airline pre-empt Air India’s possible entry on the Mumbai - Phuket route.

This will take IndiGo’s weekly frequency to Thailand from India to 56 from 44 flights, next only to Thai Airways which operates 68 weekly frequencies to India, albeit with higher seats on offer as it deploys its widebody aircraft on most routes to India.

Booking Agencies seeing traction too

Various Online Travel Agencies have reported a search anywhere between 20% to 80% in searches for visa free destinations. Thailand, Vietnam, Indonesia, Malaysia and Sri Lanka are currently visa-free for Indians. While most of these did not have a cumbersome procedure for visa, with many also offering visa on arrival (paid), the attraction of visa-free is far and beyond.

“Countries that have removed visa requirements for travellers from India, including Thailand, Vietnam, Sri Lanka, and now Malaysia, have seen a 30%+ positive uptick in searches and bookings on our platform” said Rajesh Magow, Co-Founder & Group CEO, MakeMyTrip

Magow said positive traction aligns with expectations, as visa-free entry, supported by enabling factors such as the availability of direct flights, reduces hassles as well as costs. “For instance, the approximate visa cost for a family of four traveling to Thailand was Rs. 20,000. Therefore, it's not surprising that Thailand, despite already having a large number of travelers, has still seen a boost in bookings. The sustained week-on-week trends confirm that the surge is real and will continue.” he added.

Constrained by capacity

The lull that had set in pre-Diwali led to a shakeup of air fares with airlines announcing sales and dropping fares in search of passengers. Today as the demand skyrockets, Indian airlines are severely short of airplanes to deploy on these routes. IndiGo faces an overall challenge with the multiple groundings that start in January while Air India is inducting planes but does not have spare wide body capacity to offer more seats.

SpiceJet, even with the news of funds infusion, will not be able to immediately capture the market. Akasa Air does not have rights to Thailand just yet.

Tail Note

The visa-free travel is only until May 2024, which does not cover the entire peak summer holiday season. By the time airlines respond, it may be the end of the visa free period or will Thailand extend considering the rush?

Airlines may be happy to not add capacity, which means the fares will go up considerably but there comes the tipping point. The money saved in visa should not go towards air fares, else it does not become favourable and then Thailand competes with Malaysia, Vietnam, Indonesia and Sri Lanka - countries which have a coastline but different specialities, yet all bounded by natural beauty.

Thailand remains the only country where Indian carriers have been able to make the most of this sudden rush. Indian carriers have very limited presence in Malaysia and Vietnam while Sri Lanka is a mixed bag.