The Economic Impact of Destination Weddings: Assessing the Effects of Outsourcing Indian Wedding Tourism

This research paper examines the growing trend of affluent Indian couples opting for overseas destination weddings and assesses the resulting economic costs in terms of lost domestic income and tax revenue. With estimates that nearly 5,000 rich Indian weddings now occur abroad each year, the paper aims to quantify the financial leakage and explore policy options. A cost-benefit analysis framework is utilized, collecting primary data on the higher expenses of foreign weddings compared to domestic events. Interviews with Indian wedding planners provide additional context on factors driving this trend, such as perceptions of overseas venues as more prestigious. Financial modeling techniques are leveraged to estimate impacts on GDP, jobs, and taxes due to redirected consumption abroad. Findings indicate that overseas weddings result in an annual economic loss between $10.5 billion to $14 billion for India, depriving the country of between $1.5 billion to $2 billion in tax collections. This suggests the recent public appeals by Prime Minister to encourage Indians to “Wed in India” carry real economic weight, rather than reflecting mere nationalism. Compelling financial data exists showing how the overseas wedding trend negatively impacts domestic small businesses and artisans as well. However, restrictions on Indian destination weddings also risk unintended consequences and run against liberal ideals. Policy options are weighed such as incentives to boost domestic wedding tourism. The paper recommends a balanced approach, increasing public awareness of economic trade-offs while letting personal choice prevail. Creative options like a voluntary “wedding fund” could allow couples opting for foreign venues to dedicate a portion of expenses to support women artisans back home. Further research around optimal policy responses is still required. But the paper signifies the first systematic effort to quantify the macroeconomic effects of overseas Indian weddings using microeconomic data on altered consumption patterns.