Impact of Mega-Events on India’s Economy: Mazhar Nadiadwala, Managing Director, Dome Entertainment
The resultant recognition that mega-events bring to the host countries leads to catapulted growth and places countries on the world map as a favourable destination to hold future events writes Mazhar Nadiadwala.
Typically hosting mega-events has been awarded to developed nations in the past. However, a host of developing nations are hosting global mega events. Event organisation is one of the fastest growing sectors with developing nations like India, with an estimated growth rate of 10% Year- on-Year dispelling all speculations and concerns around capacity-planning, benefits, expenses and experiences It is therefore considered a flourishing and promising industry. All over the world, we see a high demand to host Mega-events such as the Olympics, the FIFA World Cup, Super Bowl and various music festivals.
The economic impact of mega-events attracts numerous investors and cities to pursue the hosting rights; new venues are even built or refurbished even if it is for just one specific major- event. The massive investment that goes into the hosting of events and the impact and influence on the hospitality industry has drawn considerable attention. In fact, the resultant recognition that such events bring to the host countries has further led to catapulted growth and placed it on the world map as a favourable destination to hold future events.
Positive impact of Mega-Events
The primary economic benefits from mega-events consist of direct and indirect expenditures from visitors, for example, large traveling costs on accommodations, food and beverages, tickets, event merchandise, entertainment and shopping. Such events also result in the increase in employment as they require multiple volunteers or heads to run the show smoothly. Such events require best in class infrastructure and also add up as a major source for revenue generation for the host venues. It also builds the confidence of the organisers to come back to the host city/ country to host future events of such a large scale. It will also help in the development of transport and infrastructure in the host city or country.
● Opportunity of Funding
Noticeably, the extensive exposure of mega-events via mass media coverage has seized the public's attention as well as the investors. It is appealing for almost every brand to take the opportunity in the course of events to promote itself across the world by way of sponsoring, advertising, or any other way of participation in the mega-events.
● Infrastructure Development and Urban Growth
Most mega- events such as the Olympic Games, the FIFA World Cup and Super Bowl have specific requirements when it comes to facilities. To host an event of such magnitude requires bidding. The country needs to fulfil certain criteria with regards to the potential to successfully stage the games, demonstrated government support, level of preparedness, healthy management system and the ability to accommodate the large contingent that may come with the event. It stimulates the hosting cities to develop their facilities and improve the public infrastructures in order to win the hosting rights at the time of bidding to have a successful event.
Major-events engage more out-of-town visitors; this therefore results in them extending the length of stay. The cost of accommodation hence is bound to rise
Preparation for a major mega event means extensive involvement of the government and a direct impact on the country’s GDP - from creation of jobs and businesses to raising per capita income. Additional skills are received by the host country for preparation and hosting - hospitality, transport and communications, management, volunteers, concierge, medical services, public safety, civic amenities etc. After the success of a mega-event, the state machinery or the government at the helm of affairs is credited giving the country a chance to brand itself in dialogues of international diplomacy. And it does not end there - the hotels and stadia will continue functioning and require maintenance, which means continued employment opportunities in that sector.
● Local Tourism
What a mega-event or promotions for the same at a location/venue does is it gives immediate exposure of the venue to the world/fans which in turn leads to increasing infrastructure for business and tourism opportunities. More often than not, the state machinery speeds up investments and ownership in overlooked sectors and brings about infrastructural changes. The downside is budgets are adjusted or reduced in other public services, taxes are bumped up and there is a rise in foreign borrowings.
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