The Sports Budget in 2024-25

Predicting India's Strategic Leap through its Sports Budgeting targeted at Olympic Aspirations

In the pursuit of greatness, as in the Olympics, meticulous planning and wise financial strategies are the invisible champions that propel us beyond the finish line of success.

Might seem like a stretch to start with but let's take a dive and see. At the outset, the economic and business expansion that India may experience as a result of its bid to host the 2036 Olympics would be reflective of the patterns from previous years and a predictive analysis suggests a strategic and multifaceted allocation of resources. This ambitious initiative is not just a showcase of India's sporting prowess but also a strategic move poised to catalyze comprehensive economic growth and business opportunities. As India sets its sights on this colossal event, the nation's sports budget for 2024-25 is expected to reflect a significant uptick, aligning with the infrastructural and organizational demands of hosting the Olympics. This heightened investment goes beyond creating state-of-the-art sports facilities and infrastructure; it encompasses stimulating various sectors such as tourism, hospitality, retail, and technology, thereby fostering a broader economic development.

Looking at the historical data from past Olympics, the hosting of such an event has proven to be a catalyst for economic growth. For instance, the London 2012 Olympics led to substantial urban regeneration and business opportunities in and around the city. Similarly, the Tokyo 2020 Olympics, despite the challenges posed by the pandemic, involved significant investments that boosted various sectors of the economy. Drawing from these precedents, India's Olympic bid can be a gateway to amplifying its global business presence. The anticipation of the 2036 Olympics in India is likely to attract global investors and businesses, eyeing the multitude of opportunities that accompany such an international event. This could lead to advancements in infrastructure, technology, and services, creating a ripple effect across various industries. Moreover, the global exposure and networking opportunities presented by the Olympics could pave the way for long-term partnerships and collaborations, further strengthening India's position in the global market.

I aim at a discussion on how the sports budget for 2024-25 could be a strategic tool for India to leverage these opportunities, laying the groundwork for a successful Olympic bid and concurrent economic expansion. I would've asked for a deeper engagement with Rajesh Rajagopalan sir or Col Mumuksh Mehra or Karamveer Singh Bakshi or Pranav Yadav . or Arjun Singh or Arjun Halappa( Olympian) since they have a birds eye view of the situation, the focus will be on the potential business growth and development prospects that could emerge as India prepares for this global sporting spectacle, highlighting the multifaceted benefits of hosting the Olympics beyond the realm of sports. Since we are at it, let's discuss a few broad factors important for leveraging the event for maximum economic and social benefits as we go through it.

Historical Spending Trends in Indian Sports Budget

The Indian government has consistently increased its investment in sports. Notably, the budget allocation for the Ministry of Youth Affairs and Sports witnessed an 11% increase in 2023-24. This uptick is part of a broader pattern of enhanced funding for sports in India, highlighting a commitment to elevating the nation's presence in the global sports arena. A significant portion of this budget has been earmarked for infrastructure development. This includes the construction and upgrading of sports facilities, stadiums, and training centers across the country. Such investments are crucial for nurturing sporting talent and hosting international sports events.

Alongside infrastructure, there has been a substantial focus on athlete development and grassroots programs. Initiatives like Khelo India, aimed at talent identification and nurturing at the school and community levels, have received considerable funding. These programs are essential for creating a robust pipeline of athletes who can compete on international stages. While the TOPS scheme has also pushed the elite athletes forward. The increased budget also reflects India's ambition to host international sporting events. The success in hosting events like the Commonwealth Games and the increasing interest in bidding for the Olympics indicate a strategic direction towards enhancing India's global sports profile.

When compared with global spending trends on sports, particularly in countries that have recently hosted the Olympics, India's increasing sports budget aligns with international standards. For example, the Tokyo 2020 Olympics had a budget of around USD 13.0 billion, while the London 2012 Olympics had a public sector funding package of ï¿¡9.298 billion. These figures suggest that India, in its bid for the 2036 Olympics, is on a comparable path in terms of financial commitment to sports development. Looking ahead, this trend in increased sports funding is expected to continue, especially in light of India's Olympic aspirations. The focus is likely to expand beyond infrastructure and athlete development to include advancements in sports technology, research, and international collaborations, especially being aligned with budget trends of previous Olympics.

Comparative Analysis with Previous Olympics

The comparative analysis with previous Olympics provides insightful benchmarks for India's preparations for the 2036 Olympic bid. By examining the budgets and organizational strategies of the Tokyo 2020 and London 2012 Olympics, we can glean valuable lessons for India's approach. Let's look at Tokyo & London since Rio data has a few issues.

Tokyo 2020 Olympics:

• Budget: The Tokyo 2020 Olympics had a total expenditure of around USD 13.0 billion. This budget emphasises the financial scale required for modern Olympics, considering factors like technological advancements, infrastructural development, and operational costs.
• Technological Emphasis: Tokyo 2020 was notable for its emphasis on technology, including the use of 5G networks and robotics. This technological investment enhanced the overall experience and efficiency of the Games.
• COVID-19 Impact: The unprecedented postponement and challenges due to the COVID-19 pandemic led to additional costs, illustrating the need for flexibility and contingency planning in budgeting and execution.

London 2012 Olympics:

• Budget: The London 2012 Olympics had a public sector funding package of ï¿¡9.298 billion. The investment was not just in sports infrastructure but also in urban development and regeneration.
• Legacy Planning: London 2012 is often praised for its legacy planning, which included the transformation of the Olympic Park into a public space and the development of East London.
• Public-Private Partnerships: The Games utilized effective public-private partnerships (PPPs), which were key in efficiently managing resources and costs.

Implications for India:

• Financial Scale and Allocation: India's budgeting for the 2036 Olympics will need to consider the financial magnitude demonstrated by Tokyo and London. This includes investments in infrastructure, technology, and operational planning.
• Legacy and Urban Development: Following London's example, India can focus on the long-term legacy of the Olympics, ensuring that the infrastructural developments benefit the country beyond the event.
• Technological Investments: Taking cues from Tokyo, India could emphasize incorporating advanced technologies to streamline operations and enhance the Games experience.
• Flexibility and Risk Management: Tokyo's experience with COVID-19 highlights the importance of flexible planning and risk management in the face of unforeseen challenges.

I wanted to do a comparative analysis with Tokyo 2020, Rio 2016 and London 2012 since it provides India with a framework for budget allocation, technological integration, legacy planning, and risk management, all crucial for a successful bid and execution of the 2036 Olympics. The substantial investments made by Tokyo in 2020 (approximately USD 13.0 billion) and London in 2012 (public sector funding of ï¿¡9.298 billion) provide valuable benchmarks. These figures indicate the scale of financial commitment required for hosting the Olympics. India is expected to follow a similar trajectory, prioritizing state-of-the-art facilities, robust security measures, and operational excellence. These areas include infrastructure development, athlete development and support, grassroots and talent identification programs, and security and operational planning.

Infrastructure Development

• Significance: The development of sports infrastructure is a cornerstone for hosting the Olympics. It involves constructing new facilities and enhancing existing ones to meet international standards.
• Indian Context: Considering projects like the Sardar Vallabhbhai Patel Sports Enclave in Ahmedabad, significant funds are expected to be allocated for building world-class stadiums, training facilities, and athlete accommodations.
• Global Benchmarks: Previous Olympic hosts, like London and Tokyo, invested heavily in infrastructure, which not only facilitated the Games but also contributed to long-term urban development and public utility.

Athlete Development and Support

• Significance: Preparing athletes for the global stage is crucial. This includes enhanced training, healthcare, nutrition, and psychological support.
• Indian Strategy: Following the increase in sports budget, there could be more comprehensive programs for high-performance training, international exposure, and athlete welfare schemes, similar to the models adopted in countries with a strong Olympic presence.

Grassroots and Talent Identification Programs

• Significance: Grassroots programs are essential for nurturing budding talent and ensuring a continuous supply of skilled athletes.
• Indian Initiatives: Programs like Khelo India have shown commitment to this area. The budget is likely to further boost these initiatives, focusing on talent identification and development from the grassroots level.

Security and Operational Planning

• Significance: Ensuring the safety of participants and spectators is paramount. Efficient operational planning is required for smooth conduct of the Games.
• Learning from Past Hosts: The increased security costs and logistical complexities of London 2012 provide valuable insights into the scale of planning and investment required in these areas.

Research and Innovation in Sports

• Emerging Focus: With technological advancement being a key factor in modern sports, a portion of the budget may be allocated towards research and innovation in sports science, analytics, and performance enhancement techniques.
• Global Trend: Following the technological feats of Tokyo 2020, India may invest in similar innovations to enhance training and competition standards.

Environmental Sustainability and Legacy Planning

• Growing Importance: Sustainable practices in hosting the Olympics are increasingly critical. This includes eco-friendly infrastructure and legacy projects that benefit communities post-Games.
• Lesson from Rio 2016: The challenges faced by Rio in terms of environmental sustainability and legacy utilization underline the importance of this focus area

Predictions for Sports Budget 2024-25

The sports budget for 2024-25 is expected to be a strategic blend of infrastructure development, athlete support, grassroots initiatives, and technological advancements. I would've really loved to pick the brains of one of the most sorted sports thought leaders in India, Hemant Dua for talking on this. He might pause and then say that these focus areas, informed by global trends and past experiences of Olympic hosts, are not just steps towards a successful Olympic bid but are also investments in the long-term development of sports and related sectors in India, looking at his extensive work in the field. While we can do it from scratch, I've speculated this based on current trends and comparative analysis with previous Olympic hosts.

India's Projected Sports Budget for 2024-25 (INR 3521.65 Crore ≈ USD 472 Million)

Comparing the projected sports budget of India for 2024-25 with the spending priorities and budgets of previous Olympic hosts like Tokyo 2020, Rio 2016 and London 2012 provides insightful context into how different nations prioritize their investments for such a global event.

1. Infrastructure Development: INR 1408.66 crore (≈ USD 189 million, approx. 40% of the budget). This reflects a significant investment in creating and upgrading sports facilities, aligning with the common priority of previous hosts to ensure world-class venues for the Olympics.
2. Operational and Security Expenses: INR 704.33 crore (≈ USD 94 million, approx. 20% of the budget). This is consistent with the heightened security and operational measures observed in recent Olympics, acknowledging the scale and complexities of hosting such an event.
3. Sports Development Programs: INR 704.33 crore (≈ USD 94 million, approx. 20% of the budget). This mirrors the investment patterns of countries like the UK and Japan in nurturing talent and enhancing the overall sports ecosystem.
4. Athlete Preparation and Welfare: INR 352.16 crore (≈ USD 47 million, approx. 10% of the budget). This allocation for athlete development is critical, much like the investments made by previous hosts in their athletes' training and well-being.
5. Research and Innovation in Sports: INR 352.16 crore (≈ USD 47 million, approx. 10% of the budget). Investing in sports science and technology is a relatively newer trend, gaining prominence as seen in Tokyo's emphasis on technology.

Other Crucial Points to Take into Account

1. Starting Point - Past Budget Trends:The baseline for our future projections is the sports budget for the fiscal year 2023-24, which was around INR 3062.30 crore. There has been a consistent increase in the sports budget over the years, with an 11% hike in 2023-24 compared to the previous year. This increasing trend reflects the Indian government's growing focus on sports development, particularly with the Olympics in view. Comparing with past budgets gives us a trajectory of growth, helping in predicting future allocations. Understanding how other countries have increased their sports budgets for events like the Olympics can provide a benchmark for India.
2. Inflation Impact:An average inflation rate of 4% per annum is factored in, reflecting the general rise in prices over time. Inflation affects the real value of the budget, impacting purchasing power for sports infrastructure and services. The escalation in costs for construction, operation, and maintenance due to inflation is accounted for. Future budget projections are adjusted to reflect these increased costs. The inflation rate is in line with global economic conditions, ensuring a realistic approach.
3. Economic Growth and Increased Budget Allocation:Assuming a 6% annual increase in the sports budget aligns with India's economic growth trajectory. This increased rate indicates a more substantial commitment to sports development than in previous years. The potential Olympic bid is a significant factor driving this increased allocation. The increase is compared with budgetary changes in other sectors and overall economic growth. The 6% increase is considered sustainable and achievable within the context of India's overall economic policies.
4. Yearly Budget Calculation (2024-2036):The effective growth rate of 2% is compounded annually, reflecting a realistic increase over each year. It also demonstrates how each year's budget builds on the previous year’s allocation. This approach aids in long-term financial planning for sports development which in turn allows for future adjustments based on actual economic conditions. It also ensures that the budget aligns with the cycle and requirements of the Olympic preparation phase.
5. Sector-wise Allocation:Maintains a consistent percentage allocation across various sectors like infrastructure and athlete development. Although percentages remain constant, the actual amount increases, adapting to the growing needs in each sector. It ensures a balanced approach across infrastructure, human resources, technology, and other areas, allowing to prioritize sectors based on their importance and immediate needs. Also, regular monitoring can help in reallocating funds if necessary, based on the progress and effectiveness in each sector.

Comparison with Previous Hosts

Tokyo 2020 (USD 13 Billion):

• Technology and Innovation: A significant portion was allocated to technological innovations like 5G and robotics.
• Infrastructure: Major investments in building and renovating venues and the Olympic village.
• Operational and Security: High expenses on operations, including the unexpected costs due to the COVID-19 pandemic.

Rio 2016 (USD 13.1 Billion):

• Infrastructure: Significant investment in sports infrastructure, but faced challenges in timely completion and post-Games usage.
• Economic Struggles: Faced substantial economic challenges, impacting the overall budget and the execution of planned projects.
• Legacy Concerns: Struggled with legacy planning, leading to underutilized facilities post-Games

London 2012 (GBP 9.298 Billion ≈ USD 12 Billion):

• Urban Development: Large-scale urban regeneration projects, particularly in East London.
• Legacy Planning: Focused on the long-term use of the Olympic Park and related facilities.
• Public-Private Partnerships: Efficient resource utilization and execution of the Games through partnerships.

Analysis

• Scale: India's budget is significantly lower than that of Tokyo and London, reflecting differences in economic scales, the cost of living, and operational costs across these countries.
• Priorities: While the proportional allocations in areas like infrastructure and athlete development are similar, India's budget reflects its stage of sports development, with a focus on enhancing domestic sports infrastructure and talent nurturing.
• Innovation and Technology: India's increasing allocation for research and innovation is a step towards emulating the technological emphasis seen in Tokyo.

Since we are on the beginning of the ramp, a detailed analysis of India's sports budget projection towards the 2036 Olympics is important as it not only indicative of the country's escalating commitment to sports excellence but also aligns with its broader economic growth and global aspirations. Such a strategic approach ensures balanced development across key sectors, developing a sustainable sports ecosystem and enhancing India's position on the international sports stage. Dr. Ashish Karnavat or Dr. Sarthak Mondal might be able to tell us better, as sports economists, but I feel the government’s focus should span across various areas: infrastructure development, human infrastructure, encouraging startups, operational and security enhancements, and other key sectors.

• Infrastructure Development (40%): The bedrock of Olympic preparation, infrastructure development should receive a significant portion of the budget. The Bridge by Arshi Yasin just today mentions a new company formed by the #gujaratgovernment, to prepare for #olympics2036. This includes building new sports facilities, upgrading existing ones, and enhancing urban infrastructure to support the influx of athletes, officials, and tourists. However, it’s crucial that these infrastructures are built with a post-Olympic legacy in mind, ensuring they serve the community and don't become underutilized "white elephants" like the arenas of the past such as the Asiad infrastructure in Delhi, Balewadi in Pune, etc. Yearly allocation should be ranging from INR 1600 crore in 2024 to INR 2480 crore in 2036.
• Human Infrastructure Development (25%): Alongside physical infrastructure, investing in human infrastructure is vital. In my last post, Ravneet Gill had emphasized the need for it well. Also, if I talk to Neel Shah or Ravishankar Sahu or Srinivvasan G , they would all champion the Human Infrastructure development & since we understood it too, we started Kreedangan to have a policy level discussion on it. This includes training coaches, sports administrators, and support staff, and developing a robust pipeline of athletes across various sports. The focus should be on comprehensive development – from grassroots to elite levels – ensuring a sustainable supply of talent and skilled professionals in the sports sector. Annual allocation should range from INR 1000 crore in 2024 to INR 1550 crore in 2036.
• Encouraging Startups and Innovation (15%): Taking a cue from the Gujarat Sports Startup Conclave spearheaded by Harsh Sanghavi ji, the Government should allocate funds to encourage startups in sports technology, data analytics, and athlete performance enhancement tools specifically. This can be achieved through grants, incubation programs, and partnerships with educational institutions dovetailed with Startup India scheme but specifically for sports. Startups like Dartle , KheloMore , GaitON | Posture, Gait & Sports Biomechanical Analysis , Sporjo , etc. can bring innovation, create jobs, and elevate India’s position in the global sports technology market. I'd assume an annual allocation between INR 600 crore in 2024 to INR 930 crore in 2036.
• Operational and Security Enhancements (10%): Pankaj Markandey , being an ops expert, might help in understanding this better but as the Olympic games are a massive logistical undertaking, investments in operational planning and security are non-negotiable. This includes technology-driven solutions for crowd management, event scheduling, transportation, and safety measures. The aim should be to ensure a seamless and secure experience for all stakeholders with an allocation of INR 400 crore in 2024 to INR 620 crore in 2036.
• Other Important Sectors (10%): Apart from these primary areas, investments should also be made in sectors like healthcare, tourism, and cultural programs. Though Prof. Somesh Singh 's ideas of indigenously Indianizing collaterals with regional artwork is phenomenal, I can envision a better collaboration between rural craftspeople and designers for certificates, apparel, etc. to augment that sector through sports and vice versa. These sectors will play a crucial role in enhancing the overall experience of the Olympics and showcasing India’s cultural richness & if we can allocate approx. 10%, i.e. INR 400 crore in 2024 to INR 620 crore in 2036, we can see growth.

These suggestive allocations reflect a balanced approach towards developing physical infrastructure and human capital, fostering innovation in sports technology through startups, and ensuring operational excellence and security. The 'Other' category can accommodate various needs such as athlete welfare programs, research activities, and other unforeseen expenses that may arise in the lead-up to the Olympics. If this or similarly structured allocation strategy is designed, it will ensure a holistic development of the sports ecosystem in India, paving the way for a successful Olympic bid and creating a sustainable sports legacy for the future.

Amit Gupta | Abhijit Dabhade | Abhinav A. Bindra OLY | Gagan Narang | Pinaze Dubash (PhD) | Edward Francis Paul | Arnab Das | Rajaraman G | Hakimuddin Habibulla OLY | Juthika Mehta-Dwivedi | R.Vidya Praveena Varghese | Abhijit Bhattacharya | Nitin Beri | Mahesh Ranka | Siddharth Deshmukh | Venu Rajagopalan | Unmish PARTHASARATHI | Arshi Yasin | Nihal Pradeep | Siddharth Hans | Jatin Paranjape | Srinivvasan G