Monday, March 23, 2009

Setting a precedent

Heaven forbid, but if we are faced with a mid term poll that coincides with the Commonwealth Games of 2010, what will the Government of India do?

If precedents are anything to go by, the Government will probably throw its hands up and state that it cannot provide adequate security to cover for both events.

So, where does that leave tax payer money spent on getting Delhi ready?

I firmly believe that the Government overestimated its position vis a vis the IPL. And not because the IPL is a "shrewd combination of sport and business" but because the IPL presented an opportunity to showcase the fact that India was capable of providing adequate security to all.

Dates could have been juggled, and they were. Venues could have been juggled, and they were too. And yet, the IPL is now going to be played outside the land.

What then, the prospects for the 2010 Commonwealth Games? Another terrorist attack anywhere in India or its neighbourhood and all of the tax payer money pumped into Delhi will come to nought.

And what about the elections themselves? Does the Government's inability to provide security for the IPL then translate into an incident free elections? No pre-poll and post-poll violence? No rigging? No booth capturing?

And what will be the Governments position if any of the above happen?

PS - This survey, if accurate, is illuminating.

PPS =

Exhibit A

The Nano has been launched

The bookings will commence on April 9 and will go on till April 25.

Just ahead of the Nano launch on Monday, Tata Group Chairman Ratan Tata told editors that the car, which would have the smallest footprint on the road, will be sold to the first 100,000 buyers at a price to be announced later.

The promise that has been made to sell the car at around Rs 1-lakh would be kept despite the fact that commodity prices had shot up, Tata said, adding that the fall in commodity prices now may provide some cushion.

The delivery of the first lot of Nano cars will begin in early-July, he said, adding that applications for booking of the car would be available in 30,000 locations in 1,000 cities across India.

Exhibit B

India will hold general elections to the 15th Lok Sabha in 5 phases on April 16, April 22, April 23, April 30, May 7 and May 13, 2009. The results of the election will be announced in single phase on May 16, 2009. [1]

Given the buzz, and the hype, and the interest, in the Nano, 30,000 locations in 1,000 cities represent both a logistical and security nightmare. And funnily enough, the booking overlap the first 3 phases of the general elections.

Whither security concerns then?

PPPS -

The termination of the Indian Premier League’s Sony contract has meant that Indian government may lose Rs 1,000 crore in tax through a scheme of complex tax structures using tax havens

Other modes of revenues include sponsorships, entertainment tax, stadium collections and on-ground advertisements. The government stands to lose nearly Rs 1,300 crore on account of service tax alone.

On advertising and other contracts deliverable abroad, transfer pricing and transactions at arms-length pricing basis will keep a significant chunk of revenues away from India. Thus, states are expected to lose out Rs 1,000 crore in tax.

PPPPS:-

Aussies want Davis Cup tie pulled out of India

Citing IPL’s flight, UK pulls shuttlers out of Indian Open

17 comments:

Anonymous said...

Homer,

Is the Govt really obligated to provide security for IPL for no cost, which is a private money-making enterprise? The commonwealth, on the other hand, is a responsibility the Govt. willingly bid for and took upon. Is it fair to compare the two?

Homer said...

visajet,

Remember this

The spat is also going to cost the IPL a bit as the Mohali Police has slapped a bill of Rs.1.75 crore on IPL for its services rendered during the matches, when, according to the SSP, IPL engaged in ‘cross commercial activities’.

The BCCI has always compensated for security provided within and outside stadia during matches. The IPL is not exempt either..

And then, there is this

The Commissiorate of Service Tax, Delhi, has slapped notices on official partners and sponsors of the tournament, including Hero Honda Motors and Jaiprakash Associates, asking them to show cause as to why service tax amounting to around Rs 6 crore should not be recovered from them for providing sponsorships.

Two notices were issued to Hero Honda seeking to recover Rs 4 crore in tax. A third notice was served on Jaiprakash Associates for allegedly an amount of Rs 1.85 crore.

Service tax is not chargeable on sponsoring sports events. However, these companies are sponsoring IPL teams (and not sports events). So they are bound to pay the tax, said a department official.


The IPL also has a security budget,so the Govt is not really providing security at no cost.

Now, I dont know if Suresh Kalmadi or the IOA is paying a single naya paisa to the Govt exchequer for hosting the Commonwealth Games.

If the Govt has no responsibility towards the IPL, it has no responsibility towards the Commonwealth Games either, no?

Thanks for your comments and welcome to the blog.

Cheers,

someone's dad said...

visajet is right, but the govt could and should charge for the security provided for IPL.Not just run away claiming exigencies. Homer, by the time Commonwealth Games are held, this imbecile govt will no longer be in Power. And my dear Homer, if Midterm polls are called, the same will be held after and not during the Event. Trust India to bend backwards when Commonwealth ( Whities) are involved. I am more worried about a prearranged tour of say SAffers or Poms occur simultaneous with any Election, State or Central, Will this be a precedent to call of the less important event of the Two

Homer said...

someone's dad,

Parties change, policies dont. And therefore, I think this issue supersedes the current govt - this issue has to do with how the institution that is the Govt of India reacts to this particular contingency.

I firmly believe that the way we shape our institutions is going to be the way our institutions shape us, and I am disappointed that the people in power have been found wanting in this regard.

And yes, I agree with you that irrespective of the party in power, India will bend over backwards to accommodate the Commonwealth Games - we already have precedent for that
here, and here

Cheers :),

Anonymous said...

Homer, if Pawar had not unveiled his prime ministerial ambitions, would the government have been more favourable to the IPL?

Kartikeya Date said...

The devil is in the details Homer. The problem with the IPL is the intense concentration of a fairly large amount of security being required at a number of venues in a number of cities in rapid succession.

Besides, after the Lahore incident, this is now a question of protecting an event which has specifically been attacked.

With the commonwealth games, they probably already have a plan in mind as far as security is concerned, unlike in the case of the IPL where the Lahore attacks and the General Election gave them only a few weeks to do this.

I wouldn't underestimate the scale of the requirements for the IPL.

Kartikeya Date said...

Besides, quite apart from the basic lower level security - which would be beat cops, they probably need commandos and armed paramilitary as well. Those are not as easily available as cops.

Prabu said...

Kartikeya,

The problem is that this government of India has no pride. The primary duty of the government is to protect its citizens, anywhere in the world. If they cannot ensure the safety of their citizens in India then what are they good for?

Either they should have provided enough security or delared that there are no security concerns. General election or no general election, is it right of the GoI to come out and say they are concerned about the safety of their citizens and then folow it up with a statement that they cannot ensure the security? The IPL's obligation is to their stakeholders first and then to the "cricket" watching public btu the GoI duty is to the citizens of India, to protect them and allow them to prosper. Unfortunaely they have forgotten their duty and decided to play politics in this issue.

Protection of the subjects is the
very cheese of kingly duties,
The Mahabharata

Jonathan said...

Homer, I don't know what's going on with 2010, but whenever these sorts of events have been held here, the governments have been very heavily involved and committed from the start. If this is the case, it couldn't be compared with the IPL.

Anonymous said...

Correct me if I am wrong, but the cricket team doesn't actually represent the nation but the BCCI, which is a trust. So by that logic, all events organised by the BCCI are private money making exercises in nature(in either an overt or a covert way). Will the same rationale apply during the Cricket World Cup in case we have mid term/ state elections then?

John said...

Homer, the dfference is that the CWG is held in one city only and hence the logistics of securing it is far less complicated. Its unlikely that security can be used as an argument to shift the venue. Whoever makes that argument will be laughed off. Not with the IPL straddling venues and police forces across the country.

Apart from that, I agree with you in that the government has to make all reasonable afforts to make sure that all kinds of legitimate businesses are able to operate in a secure environment.

Homer said...

Adverbin,

If that is the case, it is a sad indictment of Indian politics.

Cheers,

Homer said...

Kartikeya,

Agreed.

But a snap poll can happen anytime. And the number of athletes for the Commonwealth Games will be far in excess of the participants in the IPL. And Lahore wll always stay with us.

This was an opportunity to show that the ghosts of Lahore dont haunt us. Unfortunately now, despite statements by the Home Minister to the contrary, we have proven to ourselves and the world that we are hostage to the vagaries of our neighbourhood.

Cheers,

Homer said...

Cheers Prabu. Well put.

Cheers,

Homer said...

Jonathan,

The IPL dates were announced well in advance of the elections, so it was not as if the Election Commission or the Government was caught blindsided.

And cricket is the only sport that earns revenue for the Government.

Cheers,

Homer said...

namya,

Good point.

Cheers,

Homer said...

John,

One city, multiple venues, higher volume of athletes.

17 disciplines, 10 venues.

Then there are events like the marathon that will criss cross the length of the city.

In terms of logistics, the CWG will be as big and as intensive as the IPL.

So, should we expect a city under siege, given what happened in Mumbai and Lahore?

And if you throw in elections to that mix, what gives?

Cheers,