Key Indicators:
Hotel price index, Purchasing power parity, Fuel price levels, Short-term rental price
Note: This pillar measures how costly it is to travel or operate in a country.
The data of the T&T Development Index 2024 shows the pillar, Price Competitiveness ranks the country at 5 in 119 economies, with a score of 6.04.[109] That shows traveling in Pakistan is cheaper compared to other countries. This is the only pillar where Pakistan is ranked in the top 10 economies.
On the indicator, the Hotel Price Index (which shows average room rates for midscale to upper-upscale hotels) the country is ranked at 12 with a score of 6.22. The indicator Purchasing Power Parity is ranked at 7 with a score of 6.88. Fuel Price Levels show at 24 ranks and with a score of 4.61. The Short-Term Rental Price Indicator is ranked at 10 with a score of 6.47.
Oil prices significantly influence tourism by affecting transportation and hospitality costs. Lower oil prices lead to cheaper travel and higher profits for operators, encouraging service expansion.[110] Affordable fuel and energy prices boost a destination’s competitiveness in the global market.
Fuel prices exert a direct and substantial impact on economic growth.[111] As of August 19, 2024, the gasoline price in Pakistan is PKR 260.96 per liter (USD 0.94), compared to the global average of USD 1.24 per liter.[112] Diesel in Pakistan is priced at PKR 266.07 per liter (USD 0.96), while the global average is USD 1.17 per liter.[113]
Kerosene costs PKR 171.77 per liter (USD 0.617) in Pakistan, while the global average is USD 1.02.[114]
Pakistan’s tourism industry can benefit from the decreased gasoline prices, which are lower than the global average. This can improve the country’s price competitiveness by cutting transportation and operational expenses, making travel cheaper for both domestic and foreign tourists.
According to experts and hospitality professionals, the current average hotel room rate (as of September 2024) for the three major cities, Islamabad, Karachi, and Lahore is as follows
| Hotel Tiers | |||
| Location | 1st Tier | 2nd Tier | 3rd Tier |
| Islamabad | 45,000 PKR | 18,000 PKR | 10,000 PKR |
| Karachi | 28,000 PKR | 15,000 PKR | 8,000 PKR |
| Lahore | 32,000 PKR | 13,000 PKR | 9,000 PKR |
In conclusion, Pakistan’s prioritization of travel and tourism shows signs of progress in terms of government spending and brand strategy. However, significant challenges remain in data collection and dissemination, which need to be addressed for the tourism industry to thrive.