New data from the Reserve Bank of India reveals a significant drop in overseas travel spending by Indians to $1.09 billion in March, reflecting a broader trend of declining outward remittances for travel amidst economic concerns and calls for reduced foreign expenditure.
Illustration: Dominic Xavier/Rediff
Key Points
- Indian overseas travel spending, including holiday trips, fell to $1.09 billion in March, a decline of $212.43 million from February.
- The ‘other travel’ category, encompassing holiday trips and international credit card settlements, constituted nearly 57 per cent of the total travel outgo at $623.05 million in March.
- Prime Minister Narendra Modi has encouraged citizens to reduce foreign travel and opt for carpooling to help curb rupee depreciation amid the West Asia conflict.
- Total outward remittances under the Liberalised Remittance Scheme (LRS) for 2024-25 reached $29.56 billion, with travel accounting for the largest share at $16.96 billion.
- Spending on education-related travel (including fees, hostel expenses) totalled $450.16 million in March, while investments in equity and debt instruments significantly increased to $440.22 million.
Overseas travel spending by Indians, including holiday trips, declined by $212.43 million to $1.09 billion in March compared to February, according to the Reserve Bank data.
The outward remittances for travel were at $1.3 billion in February and $1.65 billion in January this year.
Understanding the Liberalised Remittance Scheme
The RBI data on ‘Outward Remittances under the Liberalised Remittance Scheme (LRS) for Resident Individuals’ shows overseas spending by Indians under different categories, including travel, maintenance of close relatives, studies abroad, and investments in equity and debt.
Under the LRS, resident individuals, including minors, are allowed to freely remit up to $2,50,000 per financial year (April-March) for any permissible current or capital account transaction or a combination of both.
Economic Context and Government Appeals
Against the backdrop of the West Asia conflict pushing oil prices higher and pulling down the rupee to record lows, Prime Minister Narendra Modi has urged people to reduce foreign travel and opt for carpooling, among other measures.
With lesser overseas travel, foreign exchange outgo will reduce, and that can help in curbing rupee depreciation.
The RBI data showed that total outward remittances stood at $2.59 billion in March 2026, of which travel accounted for the largest share at $1.09 billion.
Breakdown of Travel and Other Remittances
The travel category under the LRS has been classified into business travel, pilgrimage, medical treatment, travel for education, and ‘other travel’.
The data showed that Indians spent $623.05 million under the ‘other travel’ category, which includes holiday trips and international credit card settlements, during March.
It accounted for nearly 57 per cent of the total travel outgo of $1.09 billion.
Spending on education-related travel (including fees, hostel expenses) totalled $450.16 million in March, while expenditure on overseas business travel, pilgrimage and medical treatment totalled $21.39 million.
The RBI data also showed that outbound remittances under the LRS towards maintenance of close relatives stood at $389.78 million in March, higher than $266.18 million in February.
Further, the overseas spending under the head ‘studies abroad’, which includes transaction when an individual avails education services remotely without travelling abroad, such as fees for correspondence courses abroad, stood at $151.71 million in March, lower than $175.68 million in February and $267.42 million in January.
Total outward remittances under the LRS during 2024-25 stood at $29.56 billion, of which travel accounted for the largest share at $16.96 billion.
The data also showed that Indians invested $440.22 million in equity and debt instruments in March, significantly higher than $265.99 million in February.
Spending on the purchase of immovable property overseas stood at $38.68 million, down from $51.36 million in February.
