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Informist, Tuesday, Dec. 3, 2024

NEW DELHI – The flurry of music concerts across India since November will provide a fillip to the economy, boosting spending and consumption, economists at Bank of Baroda said in a report. The total expenditure as a result of these concerts, which may span 2-3 months, is expected to be INR 16-20 billion, the report said.

"This amount might look meagre, but on an annualised basis it translates to a spending of (about) Rs 6,000-8,000 crore (INR 60-80 bllion) if this fresh avenue of live entertainment could be explored more in the coming days," economists Dipanwita Mazumdar and Jahnavi Prabhakar said in the report.

Several global and Indian musicians and music groups, such as Coldplay, Diljit Dosanjh, Ed Sheeran, and Dua Lipa, have either performed since November or are scheduled to perform in early 2025 across India.

"The spending push (from these concerts) is likely to give a leg-up to the private final consumption expenditure," according to the report. "Sector-specific boosts, especially to hospitality, transportation, and retail business, would be significant. The forward and backward linkages are likely to be felt in a buoyant recovery of the services sector, which is yet to show an astounding revival post-pandemic."

The events will also be a positive for job creation and the gig economy, according to the report. "Government exchequer is likely to get a push from tax collections through ticket sales, GST (goods and services tax) on hotels and restaurants, etc.," the economists noted.

Demand for concerts in India has risen in 2024. As per a recent report by a ticketing platform, demand for premium live entertainment surged 82% in 2024 over 2022. India ranks seventh in the world in terms of revenue generated from live events, ahead of South Korea, France, and Australia, the Bank of Baroda team noted in the report, citing data from Statista. "A favourable demographic, stable currency, range-bound inflation along with conducive environment for tourism has resulted in the same, making India a preferred destination," Mazumdar and Prabhakar said.

The global economy has seen a multi-fold impact because of major concerts, according to the report. The term 'Swiftonomics' was coined to describe the economic impact of pop star Taylor Swift's tours. Swift's concerts have been credited with giving a significant boost to spending across the US, Europe, Singapore, and the UK.

Back home, while the rising number of concerts is seen as a positive for consumption, their impact on inflation is likely to be small, according to the economists. "Services inflation is already benign. The share of entertainment is very low at 0.11% in the overall CPI basket. Thus, some impact might be visible as a transient bump or surge in prices of airline tickets and hotel accommodation," they said in the report. "But largely it will be capped as spending is not broad-based and is concentrated for a certain segment."  End

Reported by Shubham Rana

Edited by Rajeev Pai

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