EEMA Appeals to Finance Minister Nirmala Sitharaman for Budgetary Support to Revive the Industry
by EVENTFAQS Bureau Industry Watch | January 30, 2021 | News
EEMA Finance Minister Nirmala Sitharaman Roshan Abbas Siddhartha Chaturvedi
Ahead of the Union Budget presentation on Monday, February 1, 2021, the Events & Entertainment Management Association (EEMA) has written a letter by way of a unified appeal on behalf of the industry to Union Finance Minister, Nirmala Sitharaman. It asks the Minister to extend support for revival of the industry from the dire economic situation arising out of the pandemic.
Among other things, EEMA has asked for funds to attain stability, subsidies on employment, deferment of all statutory liabilities for a period of 12 months, refund of GST collected by the Government for three years, free rental of national monuments to hold events, and other relief. Here is the full text of the letter, signed by Samit Garg, Executive Vice President, EEMA and also Chairman of its Government Interaction Committee:
“I write this letter to your good self on behalf of the Events & Entertainment Management Association (EEMA), the apex body of the experiential business in the country. In the last few years, the event management industry has emerged as one of the fastest-growing sectors contributing significantly to Indian economic development. Whether it be trade promotion events, global road shows, concerts, sporting contests, weddings, ATLs & BTLs, etc. – India is becoming a globally preferred destination for event management activities. The diverse cultural heritage, abundant natural resources and biodiversity helps to gain the attraction of foreign travellers to organize events and to visit the country. If we take a look at the statistics, we will realize that the size of the business is close to Rs 5,00,000 crore in the organized and the unorganized sectors.
“Unfortunately, this event management business has been brought down to almost nil revenue since the first lockdown came into effect due to the COVID-19 pandemic. It would not be unfair to say that the events & entertainment industry is one of the worst affected industries - if not the worst - by the pandemic and has not even been looked at in the various concessions provided to various industries.
“The Events & Entertainment Management Association (EEMA) conducted a survey of members with 170companies which are affected by COVID-19. These 170 companies represent over 1,00,000 companies that are struggling in this pandemic. The report depicts a huge loss of business, employers’ livelihood at stake, revenue being affected globally and requirement of funds to attain stability in the long run. The major statistics found in the study were:
• 90% of business being cancelled or indefinitely postponed.
• 50-80% retrenchment of the current workforce
• Each company suffered loss of minimum Rs 1 crore
• Around 97% companies will need to raise capital or debt from institutions or shareholders, VC funding, etc., to survive.
• The ideal working capital/loan expected to keep afloat is around Rs 2-5 crore
“Since lockdown, all large scale events across all categories have been postponed or cancelled due to the COVID-19 outbreak, resulting in the event management industry taking a Rs 1 trillion hit. This comprises both formal and informal sectors. Currently, it is difficult to calculate the exact loss. There are high chances that small and medium enterprises, which bore the major impact, would be wiped out completely as it would be difficult for them to sustain amid several cancellations of events across the country.
“Since all big scale events are being cancelled or indefinitely postponed, the events industry is looking at 100% revenue loss. Around 90% of daily wagers and approximately 10 million jobs under the events industry are impacted. The industry employs around 10 million people across all verticals. With social distancing/lockdown measures being relaxed constantly and hoping that life once again becomes more normal, the Event and Entertainment Management Association (EEMA) humbly requests you to kindly consider and extend support basis below mentioned points:
1) Subsidies on employment for 12 months by Government contribution per employee of 50% of the salary.
2) Deferment of all statutory liabilities for a period of 12 months.
3) Grant/permit for refund of GST collected by the Government for three years and the same to be used to stay afloat.
4) 24 months moratorium/deferment in all principal and interest payment of loans and overdrafts.
5) Reward the corporates with a 200% weighted exemption of expenses on all domestic events conferences.
6) Immediate processing and availability of term and working capital loans with interest waiver for 12 months.
7) Allow free rentals (on merit of the event) to use national monuments and other Government venues for one year.
8) Special grant to EEMA for up-skilling the industry on managing digital/virtual events.
9) Remove the clause of minimum turnover, EMD and bank guarantees from all Government tenders for EEMA agencies across the nation for next two years.
“If the above requests are considered and implemented, it would help the event management industry in India to stand back on its feet and contribute to the larger growth of the country. It will also help in establishing India as the most preferred destination for event management, drawing foreign travellers from across the globe whilst creating substantial jobs and infrastructure.
“It would not be out of place to mention that world class events like India @75, G-20 Summit, IPL, National Games, etc., including most of the large government-organized events across all States, are now managed and produced by event management companies. It thus becomes imperative for us to come forward on time and save this young industry from perishing.
“Please accept our gratitude for having heard our plea and the Event and Entertainment Management Association (EEMA) is looking forward to your blessings and kind consideration.”
Letter signed by EEMA Executive Vice President Samit Garg asks for funds to attain stability, subsidies on employment, refund of GST collected for 3 years, free rental of monuments, and other relief.