The country's travel market is expected to touch $48 billion by 2020 with a projected growth of over 11 per cent, fuelled by domestic demand, says a report.
The report, titled 'Demystifying the Indian Online Traveller', also found that the biggest contributor is air travel which is expected to grow at 15 per cent to $30 billion.
Compiled by Boston Consulting Group (BCG) and Google India, the report also pegged the hospitality market at $13 billion, growing by 13 per cent over the next four years.
Additionally, as more people come online, smartphone penetration increases and use of digital payment goes up, the report estimates that India's online hotel market will grow to $4 billion with 31 per cent penetration at a growth rate of 25 per cent annually.
"India's domestic travel market is on an acceleration path. One of the key findings of the report is that by 2020, one in three hotel rooms will be booked online. This is a clear indicator of the growing importance of digital medium in travel research, planning and booking," Google India's industry director Vikas Agnihotri said in a statement.
The report noted that consumers typically spend 46 days on an average planning their trip.
They spend 49 minutes online on travel research and visit as many as 17 touch points during their booking journey, it said.
However, it found that the length of each online session is less than three minutes, due to the ubiquity of mobile.
"Travel is a high investment both in monetary and emotional category. Technology has led to democratisation of travel through better information and price discovery," Abheek Singhi, senior partner and Asia Pacific head of consumer practice, BCG said.
The imperative for players is to use technology and advanced analytics capability to understand individual micro journeys and offer personalised and curated travel solutions, he pointed out.