Odisha Launches Ambitious Tourism Policy 2026 to Transform Emerging Destinations with Sustainable Hotels, Heritage Projects and Inclusive Investment Incentives

Odisha is set to transform its tourism landscape with the State Cabinet’s approval of the Odisha Tourism (Amendment) Policy–2026, a major step aimed at strengthening the sector as a driver of economic growth and regional development. The updated policy aligns with the State’s Vision 2036 and Vision 2047, reflecting a clear focus on investment, sustainability, and inclusive growth across both urban and rural destinations.

The new framework introduces measures to make investment in tourism more accessible and practical. One of the most notable changes is the reduction in the minimum requirement for three-star and above hotels and resorts. Projects with as few as 10 rooms are now eligible for incentives, compared with the previous minimum of 50 rooms. This adjustment is expected to encourage smaller operators, boutique hotels, and eco-resorts to participate in the market, especially in emerging destinations where large-scale developments may not be feasible.

Existing tourism operators also benefit from simplified expansion rules. Previously, hotels and resorts needed to increase their capacity by at least 50 percent to qualify for benefits. The new policy lowers this threshold to 25 percent, allowing facilities to expand in phases, improve infrastructure, and upgrade services with greater flexibility. This change aims to boost capacity while improving overall visitor experience and service quality.

The amended policy further expands Special Tourism Zones to include additional high-potential areas such as Hirakud, Satkosia, Similipal, the Ratnagiri–Udayagiri–Lalitgiri heritage belt, the Gandhamardan region, and Bhitarkanika. These complement the existing zones of Chilika, KBK, Kandhamala, and Gajapati. The expansion is designed to channel development to lesser-known destinations, promote regional balance, and reduce congestion in traditional tourism hubs.

Projects within these Special Tourism Zones, along with those led by women entrepreneurs, Scheduled Castes, Scheduled Tribes, and differently-abled individuals, are eligible for enhanced Capital Investment Subsidy support. Eligible projects can receive up to 40 percent of the investment as a subsidy, with a maximum of ₹60 crore for projects under ₹200 crore and ₹120 crore for larger projects. These incentives aim to combine economic growth with social inclusion, encouraging a diverse range of investors and entrepreneurs to contribute to the State’s tourism ecosystem.

The revised policy also prioritizes diversification of tourism offerings. Museums and heritage properties are eligible for up to 40 percent support for capital investment, promoting adaptive reuse and preservation of cultural assets. Sustainable tourism is a key focus, with electric boats, electric caravans, and art and craft-themed complexes qualifying for up to 50 percent capital support. These initiatives encourage environmentally responsible tourism while offering unique, experience-driven products to visitors.

Emerging sectors such as MICE tourism, destination weddings, and eco-friendly travel are also emphasized in the new policy. By incentivizing these areas, Odisha aims to extend visitor stays, enhance per-capita tourist spending, and reduce seasonal fluctuations. Additional provisions support promotion of authentic Odia cuisine within the State and in major metropolitan cities, reinforcing cultural branding and creating opportunities for local culinary entrepreneurs.

A State Tourism Advisory Council will be established to oversee policy implementation and ensure coordinated decision-making across departments and stakeholders. This body will guide investment, support sustainable development, and address challenges in real-time, strengthening the governance framework for Odisha’s tourism sector.

Projections suggest that the amended policy could attract significant private investment, add nearly 15,000 new hotel rooms by 2036, and create extensive employment opportunities across hospitality, transport, handicrafts, food services, and allied sectors. Rural and nature-based destinations stand to benefit as tourism growth is linked with conservation and livelihood creation.

The Cabinet also approved Phase II of the Odisha Skill Development Project, a ₹1,140 crore initiative scheduled from 2025–26 to 2029–30 with financial assistance from the Asian Development Bank. The project will enhance workforce capabilities, particularly in tourism and hospitality, ensuring that infrastructure development is complemented by trained human resources.

Through these initiatives, Odisha is positioning itself as a forward-looking tourism destination, combining investment-friendly policies with sustainability, inclusivity, and cultural preservation. The amendments are expected to drive growth, attract diverse stakeholders, and create a vibrant, future-ready tourism ecosystem across the State.

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