An overseas holiday is becoming more expensive for Indian travellers even before they board their flights, with the rupee weakening to around ₹96 against the US dollar and tour packages having risen by about 20 to 25 per cent earlier this year.
Higher airfares and oil prices have added to the pressure. The rupee fell to ₹96.3150 against the dollar on October 1, its lowest level in two months, amid higher global bond yields and rising oil prices.
However, airfare is only one component of the overall holiday budget. Travellers planning international trips during the festive and holiday season can also look at accommodation, local transport, food, sightseeing, foreign exchange and payment charges to control the total cost.
Pavan Kumar Kavad, Managing Director of Prithvi Exchange, told *NDTV* that travellers should compare the overall cost of a destination rather than focusing only on the cheapest flight.
"Saving Rs 5,000 to Rs 8,000 on a ticket may not make much difference if the destination has higher hotel, transport, and daily spending costs," Kavad said.
Compare the complete holiday cost
A lower airfare does not necessarily translate into a cheaper holiday. Travellers should compare hotel rates, local transport, food, sightseeing and other daily expenses across destinations before booking.
A destination with a slightly more expensive flight could still result in a lower overall bill if accommodation and everyday expenses are cheaper. This becomes particularly important for families, where accommodation and daily spending can increase the total cost substantially.
Tour package prices had already risen by about 20 to 25 per cent earlier this year amid higher oil prices, airfares and a weaker rupee, according to industry reports.
Plan foreign exchange requirements in advance
The weaker rupee makes every dollar spent abroad more expensive. Travellers should therefore include foreign exchange in their initial holiday budget rather than treating it as a last-minute expense.
For a family of three or four, even a ₹1 or ₹2 difference in the exchange rate can add up when the total foreign currency requirement is substantial.
"Travellers who plan their forex requirement early have more time to compare rates and decide how much currency they actually need," Kavad said.
Travellers can also compare the costs of different payment options before departure. Credit cards, debit cards and prepaid forex cards can have different exchange rates, mark-ups and withdrawal charges.
Check card and ATM charges before travelling
The payment method used overseas can have a significant effect on the final holiday bill. Credit cards, forex cards and ATM withdrawals may involve foreign exchange mark-ups, withdrawal fees and currency conversion charges.
For example, a credit card charging a 3 per cent forex mark-up would add ₹9,000 to international spending of ₹3 lakh, before any other applicable charges.
Foreign transaction fees can vary considerably between cards, making it important to check the charges applicable to a particular card before travelling.
Travellers should also be cautious when overseas merchants or ATMs offer to convert a transaction into Indian rupees. Such dynamic currency conversion can result in less favourable exchange rates, according to financial guidance on overseas card usage.
"These charges may appear small, but they do add up to the total budget of the holiday," Kavad said.
Calculate the final airfare before booking
The headline price displayed for a flight may not represent the amount a traveller eventually pays. Baggage, seat selection, meals and other additional services can increase the final fare.
Families should therefore compare the total payable amount rather than choosing a flight solely because its initial price is lower.
A slightly more expensive fare that includes checked baggage, for instance, could work out cheaper than a basic fare followed by separate baggage payments.
Flexible dates can lower travel costs
Festive and holiday periods can push airfares higher, making flexibility around travel dates another potential source of savings.
Travellers can compare fares for several days before and after their preferred departure date. Returning on a weekday rather than a weekend may also reduce the ticket cost.
A one-stop flight could cost less than a direct service, although the saving needs to be weighed against longer travel time, airport transfers and any additional baggage expenses.
The key is to compare the complete cost rather than the headline airfare.
Weaker rupee adds to the pressure
The currency factor remains significant for Indians travelling abroad. The rupee closed at ₹96.3150 against the US dollar on October 1, down 0.5 per cent on the day, as higher oil prices and elevated US Treasury yields put pressure on the currency.
With international travel already facing higher airfares and package costs, travellers can reduce the impact on their budgets by assessing the entire cost of a trip, including accommodation, transport, forex and payment charges, rather than concentrating only on the flight ticket.