India is facing an uncertain future in the wake of one of the worst economic crises. M Q Syed takes a dig into Exhibitions Events and Allied sectors
A month after the world’s largest and arguably the most stringent lockdown, the number of cases has breached 23000 mark, with 723 deaths as on 25thApril 2020.
Economic Impact on Exhibitions, Live Events, Weddings and Tourism
Exhibition Industry : An approximate 10 million jobs in the live events and exhibition industry are at stake with over 90% of them being daily wage earner.
As per Indian Exhibition Industry Association (IEIA) survey, India’s exhibition sector had lost an estimated Rs 3,570 crore due to the lockdown imposed across the country. The survey, however, did reveal any sample size or the basis of this calculation.
IEIA has asked the government to create an “Exhibitions in India” economic stimulus support package and offer a 10 per cent incentive to Indian exhibition management companies to organise shows in India and help recover the losses in addition to many demands for the sector.
Tourism Industry :Foreign Tourist Arrivals (FTA) has come down by about 67 per cent annually in the January-March quarter, while for domestic tourists, the figure is lower by nearly 40 per cent, according to statistics published by the tourism ministry.
Disruption due to coronavirus could result in 18-20 per cent erosion of nationwide occupancy across the hospitality sector, and 12-14 per cent drop in average daily rates (ADRs) for the entire 2020.
Most of the tourism companies afflicted by the pandemic are now anxiously looking for interim relief to pay EMIs, taxes and salaries to employees for at least six months,
The Industry body Indian Chamber of Commerce recommended a host of initiatives for the central government, including extending the RBI’s three-month moratorium on repayment of term loans to six months and a complete GST holiday for the tourism, travel and hospitality industry for the next 12 months.
Live Events Industry :Live events sector is expected to take a INR one trillion hit as all scales of events across categories have been postponed or cancelled.
This includes both formal segment of events such as IIFA film awards, T20 cricket tournament IPL, live concerts, stand-up comedy shows, community and religious evets as well as corporate events.
“Between February and March, live events witnessed 60% to 70% cancellations while April saw a complete wipe off leading to a damage of up to INR 5,000 crore as per estimation by Event and Entertainment Management Association (EEMA) with no mention of the source.
EEMA has urged government of India to extend sops such as tax refunds, loan facility for MSME sector and artistes to mitigate the impact of livelihood of people involved in the entertainment and event space.
Wedding Industry :Given how many industries; from hospitality to travel to entertainment rely on successful wedding season, the result of postponement or cancellation of all weddings could be financially devastating.
The Wedding Industry in India is estimated to be worth around $50 billion a year as per KPMG, the Wedding Industry in India during Covid 19 is perhaps the biggest hit. The livelihood of millions of gig workers who provide wedding-related services — jewellers, designers, tailors, caterers, decorators and venues are facing a huge challenge. In India an estimated 10-12 million weddings are happening every year. All events canceled or postponed from Mid March to end of May and uncertainty loom even after May 2020.
Wedding Tourism Industry :Wedding Tourism, which includes travel companies, hospitality firms, state tourism is suffering the most due to huge uncertainly and economic losses. According to Statista, wedding tourism turnover across India was projected to be valued at about Rs 458 billion in 2020, up from Rs 234 billion in 2017. This is likely to fall to zero.
General Economy and Job loss :As per survey conducted by FICCI up to 53% of businesses have specified a certain amount of impact of shutdowns caused due to COVID-19 on operations. Various business such as hotels and airlines are cutting salaries and laying off employees. By 24 April the unemployment rate had increased nearly 19% within a month after the lockdown, reaching 26% unemployment across India, according to the “Centre for Monitoring Indian Economy”, around 140,000,000 Indian lost employment in the lockdown. More than 45% households across the nation have reported an income drop as compared to the previous year.
A number of young startups have been impacted as funding has fallen. A DataLabs report showed a 45% decrease in the total growth-stage funding (Series A round) as compared to Q4 2019.