Ram Temple Consecration Triggers Historic Economic Surge In Ayodhya: IIM Lucknow Study

Lucknow: A detailed case study by Indian Institute of Management Lucknow has underlined a sharp economic transformation in Ayodhya following the consecration of the Ram Temple, citing strong gains in tourism, investment, employment and tax revenue.

The report, titled “Economic Renaissance of Ayodhya”, presents a comparative assessment of the city’s economy before and after the consecration and credits policy support and infrastructure push by the state government for accelerating growth.

According to the study, Ayodhya’s identity prior to the temple consecration was largely limited to that of a traditional pilgrimage town with modest visitor inflows, limited hospitality capacity and weak connectivity. Local markets operated at a small scale, national hotel chains had negligible presence and the absence of an airport constrained access. Employment opportunities were limited, triggering migration of youth to bigger cities, while tourism revenue and real estate activity remained subdued.

The report notes that the consecration of the Ram Temple in January 2024 marked a turning point. More than 110 million devotees visited Ayodhya in the first six months after the event, providing a major boost to local markets, transport and hospitality. Annual footfall is now projected at 50 to 60 million visitors, positioning Ayodhya among the country’s leading religious tourism hubs. Redevelopment projects worth around Rs 85,000 crore are at various stages, with investments spanning urban renewal, roads, rail upgrades and airport expansion. The study adds that initiatives linked to electric mobility and solar energy are also being promoted to support sustainable urban development.

The report estimates that tourism-led activities could generate tax revenues of Rs 20,000 to Rs 25,000 crore, while employment opportunities across hospitality, construction, transport and services have expanded sharply. Uttar Pradesh’s tourism spending is projected to cross Rs 4 lakh crore by 2025, with Ayodhya emerging as a key growth driver. The city has also gained traction as a national and international spiritual destination, drawing overseas Indians, researchers and global pilgrims.

Industry body Confederation of All India Traders has estimated that business activity linked to the consecration exceeded Rs 1 lakh crore nationwide, with Ayodhya accounting for a significant share. Daily footfall of over 200,000 pilgrims has fuelled demand across hospitality and allied sectors. More than 150 new hotels and homestays have been set up, while major hotel chains including Taj Hotels, Marriott International and Wyndham Hotels & Resorts have announced expansion plans in Ayodhya. Online travel platforms have reported up to fourfold growth in bookings for the city. Demand for local handicrafts, religious souvenirs and idols has also risen, providing direct gains to artisans and small producers.

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The study highlights a surge in entrepreneurship, with around 6,000 micro, small and medium enterprises either newly set up or returning to Ayodhya. Over the next four to five years, tourism-led growth is expected to create nearly 120,000 direct and indirect jobs across tourism, transport and hospitality. Small shopkeepers and street vendors have seen daily incomes rise to about Rs 2,500. Real estate activity has picked up sharply, with property values around the temple precinct rising five to ten times, attracting investors from across the country.

The report concludes that Ayodhya’s experience shows how faith-based infrastructure, when backed by coordinated policy support and long-term planning, can act as a catalyst for regional economic growth. The city’s transition from a traditional pilgrimage town to a diversified tourism and services hub reflects a broader development model where cultural and religious projects drive investment, employment and multi-layered economic expansion.