One of the major happenings of the year 2025 was the Maha Kumbh, which highlighted India's profound spiritual heritage and strengthened India's spiritual tourism industry. An official statement released by the Uttar Pradesh Information Department reported a record-breaking total footfall of 66 crore (660 million). The event became a massive economic and cultural phenomenon with significant implications for India's tourism, hospitality, and property sectors.
Gopal Krishna Agarwal, National Spokesperson of BJP for Economic Affairs, said, "The Maha Kumbh served as a major driver of spiritual tourism, attracting an unparalleled influx of domestic and international visitors. The sheer scale of the event highlights India's position as a global hub for religious and cultural tourism. Further, the government's focus on infrastructure and tourism-friendly policies has created long-term benefits for the region. Besides, Maha Kumbh's influence extended beyond Prayagraj, significantly boosting tourism in nearby religious hubs like Varanasi and Ayodhya, with pilgrims often extending their journeys to these sacred cities. We believe this reinforces India's vision of reclaiming its status as a global spiritual and cultural destination, where faith and economic prosperity go hand in hand."
Ambika Saxena, CEO of TWH Hospitality, stated, "The Maha Kumbh has emerged as a key driver of growth in India's hospitality sector, accelerating the rise of premium spiritual tourism. The increasing demand for high-end accommodations and bespoke spiritual experiences reflects a broader shift in consumer preferences, positioning religious tourism as a significant contributor to the economy. This evolving landscape presents a unique opportunity for both legacy hospitality players and new ventures to tap into a rapidly expanding market."
There is no doubt that India's deep-rooted spiritual heritage has the potential to drive economic growth across sectors like hospitality, infrastructure, and real estate. In fact, many European and Middle Eastern countries have been bolstering religious tourism for the economic growth of their countries. According to the World Tourism Organization (UNWTO), spiritual tourism is one of the fastest-growing sectors in the global tourism market, with the rise of wellness tourism, yoga retreats, and spiritual pilgrimages attracting millions to destinations known for their spiritual heritage. Cities like Varanasi (India), Kathmandu (Nepal), Santiago de Compostela (Spain), Machu Picchu (Peru), Jerusalem (Israel), and Mecca (Saudi Arabia) are witnessing a growing influx of spiritual travelers worldwide.
The growth of spiritual tourism in India is also experiencing rapid acceleration, resulting in a significant transformation of the real estate landscape in spiritual destinations. In recent years, there has been a marked rise in residential demand across markets influenced by thriving religious tourism. Spiritual tourism in places like Varanasi, Ayodhya, Rishikesh, and Prayagraj is bringing a huge number of domestic and foreign investors as well as tourists, which has triggered a sharp rise in demand for hotels, resorts, and homestays in and around these cities. New hospitality ventures are springing up to accommodate the influx. With better infrastructure and increased global visibility, these cities are transforming into year-round spiritual tourism destinations.
In the past year, residential prices in Varanasi have decreased by 5.15% due to increasing supply, reaching an average rate of INR 6,128 per square foot. In Prayagraj, prices escalated by 122% between January and March 2024 due to high demand and have rationalized to INR 6,645 per square foot. Prices in Puri, on the other hand, have appreciated by 30% in the past year to INR 6,114 per square foot, while in Shirdi, the average price is INR 4,028 per square foot, making these markets a compelling value proposition, according to industry reports.
Connection Between Religious Tourism & Real Estate
Government schemes such as PRASHAD and SWADESH DARSHAN are aiding the growth of spiritual tourism by promoting pilgrimage and cultural sites across various cities in India. This, in turn, is catalyzing new construction and renovation projects in response to the growing demand for retail, hospitality, restaurants, souvenir shops, and other businesses catering to tourists, creating a ripple effect of increased demand for land and real estate.
Local residents, too, benefiting from increased economic activity, are looking for improved housing options, leading to increased residential development. Real estate developers recognize the untapped potential of these cities and have unleashed a wave of project launches to meet the oversized demands of modern living spaces. What's more, residential demand extends beyond self-use, as buyers explore investment opportunities for long-term gains, from holiday homes to BnBs, to tap into the growing demand for short-term rentals.
One of the recent examples is Ayodhya, which holds great religious significance and is now on its way to becoming a popular tourist destination globally. The majestic Ram Mandir is at the heart of this transformation. With an investment of INR 850 billion (USD 10 billion), this once humble town has transformed into a vibrant spiritual center. Investments in the city have created a thriving economic ecosystem, thereby benefiting allied sectors such as infrastructure, real estate, hospitality, and more.
The Taj Group is constructing a hotel near Ayodhya airport on a 1.5-acre plot, while the HoAB!, in collaboration with Leela Group, is developing its palace hotel, The Sarayu, Ayodhya's first 7-star mixed-use development. Legendary Hindi cinema actor Amitabh Bachchan has also made notable real estate investments in Ayodhya. Before the Ram Temple's inauguration last year, the actor had purchased a 5,372 square foot plot in Haveli Avadh. Additionally, he bought another piece of land in Ayodhya City. These developments, among many other large deals, are drawing global attention and investment into this historic city.
Economic Ripple Effects Across Sectors
Religious tourism is a strong catalyst for real estate growth in India. With government support, infrastructure development, and rising spiritual tourism, investment in real estate around pilgrimage sites presents a lucrative opportunity.
Increased real estate investment in spiritual tourism destinations is fueling job creation in sectors such as construction, hospitality, retail, and other related industries, contributing to the overall economic development of the region. Developers and investors are collaborating with local authorities to restore and repurpose heritage buildings, transforming them into tourist accommodations or cultural centers.
Specialized properties catering to spiritual tourists, such as yoga retreats, meditation centers, and wellness facilities, present new investment and development opportunities within the real estate market.
The influx of spiritual tourists is also stimulating local businesses, restaurants, and services, fostering a vibrant and thriving community. This dynamic can lead to the revitalization of surrounding neighborhoods and towns, further boosting the local economy.
Infrastructure Powering Growth
Robust infrastructure, including well-connected roads, airports, and efficient public transportation systems, has played a vital role in supporting the growth of spiritual tourism in India. State governments’ investments in infrastructure development have not only benefited surrounding communities but also contributed to the growth of the region's real estate market.
Furthermore, driven by the growing popularity of sacred cities in India, investors are flocking to capitalize on the market's potential. With a diverse range of investment opportunities available—from infrastructure, hospitality, and retail to senior living—the public and private investments in these religious cities are playing a crucial role in establishing an ecosystem that fosters economic growth in the region.
The surge in spiritual tourism has driven up land prices in key pilgrimage cities such as Amritsar, Ayodhya, Dwarka, Puri, Shirdi, Tirupati, and Varanasi. Developers are actively investing in these regions, recognizing their growth potential.
In 2024, developers acquired 44% of the 3,294 acres of land in tier-2 and tier-3 cities, indicating a strategic focus on these emerging markets, according to CREDAI reports. Additionally, the report noted a significant rise in housing sales, with 681,138 units sold across 60 cities in 2024, marking a 23% year-on-year growth. The market's total sales value reached INR 7.5 trillion, a remarkable 43% increase from the previous year.
Data from Magicbricks showed that the average residential price in Prayagraj advanced by 5.5% annually, from INR 6,661 per square foot (psf) in Q4 2023 to INR 7,027 psf in Q4 2024. Residential prices in Puri rose by 30% to INR 6,114 psf, while in Shirdi, the average price remained at INR 4,028 psf, making these markets a compelling value proposition. In Ayodhya, residential prices experienced a significant spike in the April-June 2024 quarter, rising by 29.36% quarterly. However, the prices later settled at INR 8,212 psf in the October-December 2024 quarter.
Developers, including the House of Abhinandan Lodha (HoABL), are acquiring large land parcels in these locations to develop new projects. HoABL has acquired 75 acres in Varanasi, 60 acres in Vrindavan, and 45 acres in Amritsar for planned development. These moves highlight how tourism is driving the real estate boom in these cities.
With rising demand, strategic investments, and booming property values, these once-quiet pilgrimage cities are transforming into dynamic real estate hotspots. A report by CBRE South Asia highlighted the growing trend of retailers capitalizing on the surge in spiritual tourism across sacred cities in India. As more pilgrims and spiritual seekers visit holy destinations, retail brands from various sectors—such as fashion, food and beverage, homeware, and electronics—are expanding by tailoring their offerings to meet the specific needs of these visitors. This shift underscores the symbiotic relationship between spiritual tourism and the retail industry, with both benefiting from increased foot traffic.
While on their spiritual journeys, travelers not only seek spiritual experiences but also desire transformative experiences. This trend has contributed to the rise of urban spiritual centers, which attract visitors seeking more than just a pilgrimage. Retail brands have strategically adapted their offerings in established mall clusters and high-street locations to tap into travelers' desires.
Various accommodation options, including hotels, guesthouses, and wellness centers, have also been developed to meet the growing demand for spiritual travel. Local governments and businesses are joining forces to create unique retail experiences, integrating local practices into the design and offerings of shops, restaurants, and hotels.
Anshuman Magazine, Chairman & CEO - India, Southeast Asia, Middle East & Africa, CBRE, said, "The rapid expansion of spiritual tourism in India is driving the growth of the country's faith-based tourism market. Government initiatives to promote tourism and improve connectivity between pilgrimage sites further boost this growth. The rise of online retail platforms offering easy access to faith-based products and services is also a key factor."
The Spiritual Hubs & Growth Trends
The 17 emerging real estate hotspots across India include Amritsar, Ayodhya, Jaipur, Kanpur, Lucknow, and Varanasi in the North; Patna and Puri in the East; Dwarka, Nagpur, Shirdi, and Surat in the West; and Coimbatore, Kochi, Tirupati, Visakhapatnam, and Indore in the South, according to a report by Comers India.
Bolstered by the Union government’s support, spiritual tourism policies, and infrastructure improvements, these temple towns are poised for further growth. Cities such as Amritsar, Ayodhya, Dwarka, Puri, Shirdi, Tirupati, and Varanasi are expected to benefit significantly from increased tourism, with a corresponding surge in real estate development, particularly in the hospitality and retail sectors.
Rise of Spiritual & Cosmopolitan Destinations
By 2030, more than one hundred million people are expected to be gainfully employed through temporary and permanent jobs driven by India’s spiritual tourism sector, which is anticipated to be worth around US$ 59 billion by 2028, according to IBEF. These encouraging figures highlight the bright future of the Indian tourism industry and its vast potential. They also underscore the need for implementing various measures by the government and other stakeholders, as the sector remains a valuable asset with high prospects, yet requires additional attention to further accelerate its growth.
Investors view religious real estate as a stable, long-term investment, with consistent tourist footfall ensuring demand for hotels, rental properties, and commercial spaces. Real Estate Investment Trusts (REITs) could emerge as a viable option for investments in hospitality and commercial spaces near pilgrimage centers.
Government Initiatives & Challenges Ahead
The Indian government has been focusing on boosting tourism through several initiatives, including the "Dekho Apna Desh" campaign, the Pilgrimage Rejuvenation and Spiritual Heritage Augmentation Drive (PRASHAD) scheme, and the National Tourism Policy. These initiatives have significantly contributed to the development of spiritual sites across the country.
Under the PRASHAD scheme, the Ministry of Tourism provides financial assistance to State Governments and Union Territory Administrations for the development of infrastructure at prominent pilgrimage and heritage destinations. According to the latest government data, 47 projects have been sanctioned across 27 States/UTs, with an estimated cost of ?594.40 crore.
However, spiritual tourism in India faces a unique set of challenges that impede its growth and sustainability. These challenges span several areas, including infrastructure, heritage preservation, and cultural integrity.
- Lack of Infrastructure – Many spiritual sites in India lack the necessary infrastructure to accommodate the influx of tourists. Issues such as waste management remain a significant challenge, with many sites unable to handle the volume of waste generated by visitors. Effective waste management is crucial to maintain cleanliness and preserve the sanctity of these sites. Without adequate infrastructure, these locations may lose their appeal to visitors, affecting property appreciation and economic growth.
- Heritage Preservation – The lack of proper maintenance and conservation efforts at several spiritual destinations in India has led to heritage monuments crumbling or being encroached upon. Without adequate preservation measures, these sites could deteriorate over time, reducing their appeal to both residents and investors.
- Cultural Integrity – While pilgrimage cities across India offer immense growth opportunities, they also present challenges that need careful consideration. Development in culturally and spiritually significant regions requires a delicate balance between progress and preservation. Key concerns include maintaining the spiritual integrity of sacred sites and ensuring that new developments do not undermine their historical or religious significance.
- Environmental Issues - As spiritual tourism grows, the need for effective government regulations becomes crucial to balance the expansion of real estate and tourism with the preservation of cultural heritage, environmental sustainability, and community well-being. Zoning laws are one of the primary tools governments use to manage land development. These laws could restrict certain commercial or residential developments near significant religious sites to protect their sanctity.
Points to Consider
Key concerns include maintaining the spiritual integrity of sacred sites and ensuring that new developments do not undermine their historical or religious significance. While development can generate economic growth, improve infrastructure, and boost tourism, it also has the potential to disrupt cultural assets, displace communities, and harm the environment.
As tourism-related real estate grows, environmental concerns become a major challenge. In regions where spiritual sites are located in rural or natural settings, development can lead to deforestation, loss of green spaces, and the destruction of habitats. This harms wildlife and contributes to climate change, which has broader societal implications.
Many pilgrimage destinations, such as the Himalayan region or coastal cities like Puri, are ecologically sensitive. Regulations regarding water use, waste disposal, and the preservation of local flora and fauna are crucial to ensuring that tourism-related developments do not harm fragile ecosystems.
Real estate development in spiritual and religious destinations, where sacred traditions and local communities hold deep significance, raises ethical concerns. The sanctity of these sites can be compromised when religious or spiritual locations are transformed into commercial zones or tourist attractions.
Embracing the Past to Shape the Future
The intersection of spiritual tourism and real estate is reshaping India's sacred cities, ushering in a wave of transformation that blends heritage with modernity. As real estate continues to flourish, it is crucial to approach the challenges with sensitivity, ensuring that growth benefits both the people and the region's cultural heritage.
The demand for hotels, residential properties, and commercial spaces has surged in sacred cities, offering developers exciting new opportunities. However, this rapid expansion comes with the responsibility of preserving these sites' cultural and spiritual integrity. As these cities evolve into cosmopolitan destinations, they reflect India's ability to adapt, thriving as both spiritual havens and modern urban centers.
The synergy between spiritual tourism and real estate offers a future where both sectors can thrive, benefiting local communities and global travelers alike. Close cooperation between government agencies, private players, and local communities is essential in ensuring that these spiritual cities remain inclusive, sustainable, and transformative for all stakeholders. Embracing cultural exchange, economic development, and the promotion of spiritual wellness are key ways for India to position itself as one of the leading global destinations for investment.
