Indian festival season is expected to boost the economy, but a rate cut is unlikely [c1b348aa]. Economists predict that consumer spending during this year's festival season will be slightly better than in 2022, indicating a positive impact on the world's fastest-growing major economy. However, the survey data also suggests that the boost may not be significant enough to warrant a Reserve Bank of India interest rate cut. Consumption, which accounts for about 60% of India's economy, has been slow to recover from the pandemic. Despite this, around 75% of economists surveyed believe that spending during this year's festival season, from October to December, will be higher than last year. GDP growth is projected to average 6.3% this fiscal year and next, according to the median forecasts of 63 economists. Inflation is expected to average 5.5% this year and 4.8% in 2024, higher than the RBI's target range of 2-6%. As a result, the RBI is expected to keep its repo rate unchanged at 6.50% until at least the end of June next year, with the first rate cut predicted in the July-September quarter [c1b348aa].
The upcoming elections in India are also expected to have a significant economic impact [7f719e21]. While there are official limits on campaign expenses, the actual expenditure is estimated to be three times higher. This includes payments to middlemen, transportation costs, refreshments, and other expenses. The unaccounted part of the expenditure is a matter of conjecture, but it is believed that the middlemen are paid around ₹10,000 for every 50 people they bring to rallies. Additionally, expenses on food, drinks, clothing, and even liquor are incurred to attract voters. This increased spending is expected to benefit MSMEs, such as tent houses, transport agencies, and refreshment centers. The demand for fuel and vehicles is also likely to rise. The currency in circulation has already increased by ₹2.25 lakh crore since March, as people have been accumulating cash for the elections. However, the final outcome of the elections remains uncertain due to the concept of secret ballot.
Delhi traders argue that the blanket ban on firecrackers during winter, aimed at controlling pollution levels, is hurting the city's economy and causing job losses for thousands of people in the industry [503da07a]. The ban has led to a significant reduction in the number of licenses issued and has affected around 200,000 people associated with the trade. Traders also claim that the ban is ineffective on the ground due to poor implementation and that smuggled firecrackers are still being used openly. They argue that a complete ban is unnecessary since the Supreme Court has not banned green crackers [503da07a].
Measuring economic impact through studies is beneficial for developers and municipalities [e3039e5c]. The study provides data on the economic benefits of a project and helps assess its desirability and overall impact. It estimates total benefits, including tax revenues, employment changes, and additional spending impacts. The study also measures the impact on local businesses and can be used to calculate financial incentives for developers. Economic impacts are measured on three levels: direct-effect impact, indirect or induced impact, and final impact. The multiplier concept recognizes that income is spent in successive rounds within the community, creating a greater economic impact. There are multiple types of impact to analyze, including construction impacts, visitor spending outside of the resort, and impacts on existing businesses. A case study on Kalahari Resorts shows the positive occupancy impact on surrounding hotels in Ohio, Pennsylvania, and Texas. Municipalities often provide incentives for hospitality projects based on projected economic impact. Examples include tax abatements, tax incremental financing districts, infrastructure support, and tax credits or rebates. Economic impact studies are vital tools for policymakers, developers, and officials to quantify potential economic benefits and justify financial incentives for hospitality development.
Concerts and festivals contribute to short-term economic growth by increasing consumption and benefiting local economies in Ireland [d7b8bb3a]. However, the benefits are temporary as the increase in economic activity is not sustained. Long-term economic growth, which involves investment in capital and technological advancement, is not achieved through concerts and festivals. Despite this, concerts still provide regular increases in business for owners throughout the country. The value of concerts and live music extends beyond economic returns and includes cultural value. The joy and entertainment derived from attending live music events should be considered sufficient justification for their existence.
The common theme found in these inputs is the economic impact of cultural festivals, political events, firecracker bans, and hospitality development in India and Ireland.