IAAPI requests PM to save amusement park industry from economic roller-coaster ride
Amusement parks contribute nearly 40% of the total leisure industry turnover which are key drivers of growth among the service sector in India. Approximately, 30-35% of visitors are outstation visitors and thus a major source of tourism.
The Indian Association of Amusement Parks and Industries (IAAPI) is a major part of the travel, tourism & hospitality sector as amusement parks in India attracts more than 3 crore visitors annually and growing at a compounded annual growth rate (CAGR) of more than 17.5% with annual revenue of approximately INR 17 billion, providing direct employment to over 75,000 people. In India, amusement parks generate 60% – 65% from gate income (ticket sale), 30% – 35% from food & beverages and 10% – 15% from merchandise and are now suffering losses due to the black swan event encountered by the world.
Moreover, the Indian theme park and amusement park sector contributes significantly to the local economy as well as tourism while giving new avenues of entertainment of international standards to Indians with slim margins & incurring of fixed costs of operations, manpower, fuel makes operations unviable as parks operate on a seasonal basis with low footfall in monsoons. Now, this industry turnover is sinking.
In a letter written to Prime Minister, Narendra Modi, Rajeev Jalnapurkar, Chairman of IAAPI, requests the PM to consider significant factors like fiscal statutory compliance deadlines, reduction of effective rate of interest on loans from financial institutions, complete GST holiday for 12 months, moratorium of 12 months on payments to financial institutions, fiscal support for salaries, waiver of the custom duties on import of spare parts & to advise states to facilitate “Amusement Manufacturing Hub” under “Atmanirbhar Bharat Abhiyan” to manufacture amusement rides, equipment, automation, electronics and spares by providing incentives to encourage the industry. Rajeev Jalnapurkar, in the letter stated, the amusement industry which is an integral part of the Indian tourism industry is still in its nascent stage and in the prevailing turbulent environment, it needs the support of the Government now more than ever to tide over this crisis. We sincerely believe that your kind consideration of our aforesaid prayer will immensely aid the amusement industry to tide over the current predicament and enable us to continue our contribution to society and the country. On behalf of the Indian Amusement Industry, I wish to assure your kind self, that the Amusement Park industry has been strictly adhering to the SOPs issued by the Ministry of Health and Family Welfare and by respective states and will continue to do so, once parks are reopened. In anticipation of an affirmative response, for the benefit of the entire industry and the country,” addressing the Prime Minister.
This industry which is taking baby steps in India got suddenly hit by the pandemic, which is running out of working capital and is finding it difficult to meet its financial obligations such as staff salaries, advance tax, GST, PF, ESI and other state levies, loan interest and instalment payments. Sustaining business in such an environment has become a major concern and the industry is now struggling for its survival. The amusement industry is in dire straits and is now facing acute financial distress and bankruptcy, closure of businesses and massive job losses.
The Amusement industry shall play a major role in creating employment, both directly and through ancillary and other related industries like hospitality, food & beverage, transport industry and more. It will create an economic multiplier effect accelerating the growth of the economy. The industry will employ a sizeable number of people directly and indirectly and contribute to the Government exchequer significantly. It will also form a major part of social infrastructure which plays a vital role in nation-building as it offers active outdoor recreation for kids, youth and families from middle and lower-middle-class strata of the society. The industry is on the verge of collapse and needs instant emergency support to rescue and bail out the entire amusement industry from the prevailing turbulent environment. The only way this can happen is by reducing fixed operating expenses significantly in the immediate term till consumption in the sector bounces back and the economic activity revives. The amusement park industry runs on the sole purpose of creating happiness and bonding. Let’s save this industry which has brought a smile on many faces and plans to do so in the upcoming certain & uncertain times.
According to the UN World Happiness Report 2021, India has secured the 139th spot out of 149 countries. However, India ranked 140th in 2019 and 144th in 2020. The results of the report, which is based on the Gallup World Poll, have been correlated with factors like GDP and social security. A reasonable explanation for the lower rank in the happiness index can be that India’s people expect better, and they are feeling disappointed. The idea of rising expectations and increasing inequality and feelings of injustice or unfairness are also plausible contributing factors for the Happiness Index report. The report incorporates analysis by experts in economics, neuroscience and statistics, and shows how measurements of well-being can be used to evaluate a country’s progress. General assessments of individuals’ whole lives, as well as data about their emotional experiences, are collected and considered.
On behalf of IAAPI we wish to convey our sincere gratitude to Shruti Prasad Ratnaparkhi for her efforts to conveying Indian Amusement Park Industries issues to the Government and Industry stakeholders from tourism fraternity.