City Overview

Founder Chairman, Hotelivate
Often regarded as the cradle of Indian civilization, Varanasi has a rich history and has undergone several transformations. Historically known as Kashi and later renamed Benaras during British rule, it is one of the world’s oldest continuously inhabited cities, with human settlement believed to date back to 800 BC. For Hindus, it is considered the holiest of the seven sacred cities and is a highly revered pilgrimage destination. Varanasi is also a key attraction for international tourists visiting India, drawing visitors from around the world, especially during festivals and religious events like Dev Diwali and Maha Shivratri. The city is famous for its ancient landmarks, including the Shri Kashi Vishwanath Temple, Dashashwamedh Ghat, Assi Ghat, and Manikarnika Ghat. The ghats of Varanasi are major tourist attractions, with the evening ‘Ganga Aarti’ drawing thousands of spectators daily.
Tourism Overview
In recent years, Varanasi has significantly benefited from a surge in domestic tourism, driven largely by a growing interest in spiritual travel. While international air traffic to Varanasi International Airport has declined since the pandemic, domestic flights have been thriving, compensating for this shortfall. A new tourism circuit is emerging in Uttar Pradesh, encompassing Varanasi, Ayodhya, and Lucknow. Many visitors are choosing to base themselves in either Varanasi or the state capital, making it easier to explore the rich cultural and spiritual heritage of the region. Additionally, well-established road and rail networks are facilitating access for international tourists, allowing them to include Varanasi in their itineraries. Historically, Varanasi experienced seasonal fluctuations, with peak tourist traffic occurring in October & November and February & March. However, the rise of spiritual tourism and improvements in the city’s infrastructure have helped mitigate these seasonal patterns, resulting in a more consistent flow of visitors year-round.
Hospitality Overview
Varanasi currently has a limited supply of branded hotels, with fewer than 15 establishments in the city. In contrast, over 95% of the hotel offerings are unbranded, comprising largely of guesthouses and budget accommodations. Despite this predominance of unbranded options, the demand for tourism in the region has allowed branded hotels to perform exceptionally well in recent years, demonstrating resilience even with new competition.
The hotel market in Varanasi is characterised by remarkably high occupancy rates, with demand consistently outstripping supply. The city’s rich cultural and spiritual heritage makes it a year-round destination, reducing seasonal fluctuations in visitor numbers. There are currently 607 hotel rooms under development, and the inventory is expected to more than double by 2030, yet demand shows no signs of slowing.
Varanasi primarily relies on leisure demand, particularly as a religious destination for Hindus and Buddhists. While there is some demand for M.I.C.E. events—mainly social gatherings and local weddings—this segment presents challenges. Local weddings typically have lower budgets and result in fewer room nights, and the city has difficulty attracting commercial demand. With the addition of the Rudraksh convention centre in recent years, the government appears to be targeting demand for exhibitions and conferences that has historically been serviced by other cities in Uttar Pradesh. However, leisure tourism in Varanasi remains robust, and the planned development of the Sarnath region as part of the Buddhist circuit is expected to attract more spiritual tourists, particularly from Southeast Asia and East Asian countries. Ongoing infrastructure projects, such as the Kashi-Vishwanath Temple Corridor, are also enhancing the city’s tourism appeal and improving connectivity. The formalised food and beverage sector in Varanasi is also facing limitations. Formal restaurants are scarce, as crowds tend to flock to the ghat areas, dominated by well-known street food stalls like Kashi Chaat Bhandaar. Hotel restaurants often struggle to compete with these local favourites.
The future of Varanasi looks promising, with numerous proposed infrastructure developments likely to further boost demand. The expansion of Lal Bahadur Shastri International Airport is already underway, involving a new terminal and runway expansion at an estimated cost of `2,900 crores. Additionally, a new cricket stadium under construction, with a capacity of over 40,000 spectators, has the potential to introduce sports tourism as a new demand segment.
With this rapid growth showing no signs of stopping, Varanasi is poised to become not only a spiritual centre but also a significant tourism hotspot in the coming years.