3 min readFeb 1, 2026 02:50 PM IST
Finance Minister Nirmala Sitharaman said in her Union Budget speech Sunday that the tourism sector has the potential to play a large role in employment generation, forex earnings, and expanding the local economy, as she announced a slew of measures for the sector, which hasn’t been able to touch the pre-pandemic figures of foreign tourist arrivals yet.
Presenting the Union Budget 2026, Sitharaman proposed setting up a ‘National Destination Digital Knowledge Grid’ to digitally document all places of significance across the country, including cultural and spiritual, and a ‘National Institute of Hospitality’.
She also proposed the setting up of a National Institute of Hospitality by upgrading the existing National Council for Hotel Management and Catering Technology. “It will function as a bridge between academia, industry and government,” the FM said.
Archaeological sites and Buddhist circuits
Further, the finance minister also proposed to “develop 15 archaeological sites”, including Lothal, Dholavira, Rakhigarhi, Sarnath, Hastinapur, and Leh Palace into “vibrant experiential cultural destinations”.
“Excavated landscapes will be opened to the public through curated walkways, immersive storytelling skills, and technologies will be introduced to help conservation labs, interpretation centres, and guides,” she said.
Bringing together the government’s focus on the Northeast and its push to establish India as the birthplace of Buddhism, Sitharaman proposed launching a Scheme for Development of Buddhist Circuits in Arunachal Pradesh, Sikkim, Assam, Manipur, Mizoram, and Tripura. The scheme will cover preservation of temples and monasteries, pilgrimage interpretation centres, connectivity, and pilgrim amenities, Sitharaman said.
The minister also proposed a “pilot scheme for upskilling 10,000 guides in 20 iconic tourist sites” through a standardised, high-quality 12-week training programme delivered in a hybrid format, in collaboration with an Indian Institute of Management.
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The government also announced plans to support states in establishing five regional hubs across the country to promote India as a global destination for medical tourism. These will be developed in partnership with the private sector to position India as a global leader in medical value tourism, the FM said.
Key announcements include establishing three new All India Institutes of Ayurveda, upgrading the World Health Organization Global Traditional Medicine Centre in Jamnagar, and launching a loan-linked subsidy scheme for veterinary infrastructure.
‘Ecologically sustainable mountain and nature trails’
The Union Budget 2026 also highlighted eco-tourism and nature-based travel. Sitharaman said the government will develop ecologically sustainable mountain and nature trails across several regions, including the Himalayas and the Western and Eastern Ghats, to boost trekking, hiking, and eco-tourism in the country.
“…We will develop ecologically sustainable mountain trails in Himachal Pradesh, Uttarakhand and Jammu and Kashmir, also in Araku Valley in Eastern Ghats and also Western Ghats… India has the potential and opportunity to offer world-class trekking and hiking experiences,” she said.
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In addition, special trails will be created for wildlife tourism. These include turtle trails along nesting sites in Odisha, Karnataka and Kerala, and bird-watching trails around Pulicat Lake.
The Budget placed tourism at the centre of its employment and growth strategy. In her Budget speech, Sitharaman also proposed reducing the Tax Collected at Source (TCS) rate on the sale of overseas tour packages from the current 5 per cent and 20 per cent to 2 per cent, with no minimum amount, in response to a long-standing demand from the tourism industry.
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