Forbes India 15th Anniversary Special

Ayodhya: A new economic powerhouse in the making

The holy town on the banks of the Sarayu river is revving up for a major revamp with a Rs85,000 crore investment boost

Neha Bothra
Published: Jan 15, 2024 10:55:48 AM IST
Updated: Jan 15, 2024 04:49:03 PM IST

Ayodhya: A new economic powerhouse in the makingPeople lighting earthen lamps at Ram ki Paidi during Diya Deepotsav (Diwali celebrations) on November 11, 2023 in Ayodhya, India Image: Deepak Gupta/Hindustan Times via Getty Images

The spiritual and the materialistic are closely watching developments in a small town, of about 30 lakh people, on the banks of Sarayu river, in the north Indian state of Uttar Pradesh. This is the holy town of Ayodhya which will open the doors to the carved pink sandstone and white marble Ram Mandir next week on January 22. The inauguration will be attended by Prime Minister Narendra Modi, business tycoons, politicians, and celebrities from diverse fields.

In the run-up to the consecration and opening ceremonies, the town is buzzing with a flurry of economic activity as it prepares to welcome over 45 lakh devotees in the coming weeks. The once sleepy town is transforming into an important economic hub with an investment boost of around Rs85,000 crore.

An aerial view of Ayodhya shows a massive infrastructure overhaul is underway. Roads and bridges are being built for better road connectivity, the waterfront is being connected to other river banks with a water metro service, an international airport is up and running, and the railway station has been revamped and renamed Ayodhya Dham Junction. There are currently 178 development projects in progress.

The state-government has promised that the holy town will become a world-class city in the coming years as it plans to set-up modern amenities while retaining cultural aesthetics. The redevelopment of Ayodhya, as envisaged in Master Plan 2031, broadly hinges of eight themes to guide civic authorities for the upcoming smart city. The scheme includes a spiritual university, a green-field township, an urban forest, to name a few. Other highlights include a central business district, hotels, riverfront, water bodies, and dharmshalas.

Interestingly, civic authorities are projecting a ratio of 1:10 of residents to tourists. According to industry estimates, around 3.25 lakh tourists visited Ayodhya in 2021 and the following year this number rose to 2.39 crore. Now, after the inauguration of the temple, local authorities are expecting over 4 crore pilgrims to visit Ayodhya this year; turning the town into a mega tourist area and global spiritual centre.

Airlines such as Indigo and Air India have started direct flights to Ayodhya from several cities ahead of the temple-opening celebrations next week. Indian Railway Catering and Tourism Corporation (IRCTC) plans to run 1,000 Ayodhya bound trains to cater to the rush of passengers wanting to visit the holy town to witness the inauguration festivities.

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The much-anticipated boom in tourism has led to a frantic race for hotel properties in prime locations. Property prices, as per industry insiders, have risen nearly four times over the past three years in some parts of the town. Top five-star hotel brands such as the Taj, Radisson, ITC are opening new properties to cater to the projected rise in demand. In fact, over 73 new hotels are in the pipeline in Ayodhya. A new property, Ayodhya Tent City, has also come up and offers stay at luxurious tents. Praveg Resorts is looking to expand its footprint too.  

Indian Hotels (IHCL) launched two new hotels in Ayodhya under the Vivanta and Ginger brands. Both are greenfield projects in partnership with Bhardwaj Global Infraventures. “These signings are in line with IHCL’s vision to strengthen its presence across spiritual centres in India. Ayodhya is an important pilgrimage site and receives a very high footfall throughout the year. These hotels will also complete the travel circuit with Lucknow and Varanasi in Uttar Pradesh,” IHCL said in a statement.

Ayodhya: A new economic powerhouse in the making

FMCG companies are also making inroads. For instance, India’s largest mineral water company, Bisleri, announced plans to set-up a greenfield plant in Ayodhya. This will also allow the company to cater to demand from regional markets.

As the town prospers, economic benefits will trickle into more than a dozen neighboring districts, supporting the country’s growth agenda.    

In a media interaction, Dinesh Goyal, national senior vice president, Indian Industries Association, reportedly stated that he expects a business turnover of Rs50,000 crore because of ongoing preparations ahead of opening ceremonies at Ram Mandir: “Business entities across the country are capitalising on these opportunities.”  

Small business owners are seeing a spurt in business. There is growing demand for handicrafts such as decorative pendants, bangles, lockets, key rings, garlands, among others. Exports from Ayodhya, according to reports, rose by 130 percent to Rs254 crore in FY23.

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