The Union government has been pulling out all stops to host a magnificent Commonwealth Games in Delhi. Almost $2.3 billion have been spent for the succesful organisation of the October 3 to 14 event, out of which $ 600 million wereallocated for the redevelopment of five stadia — Jawaharlal Nehru Stadium, Indira Gandhi Stadium complex, Major Dhyan Chand National Stadium, Dr Shyama Prasad Mukherjee Swimming Complex and Dr Karni Singh Shooting Ranges.
To maintain these magnificent structures after the Games, the Ministry of Sports and Youth Affairs has come up with a ‘Legacy Plan’ that involves Public Private Partnership (PPP) for operations and maintenance of these stadia. Under the plan, each stadium, under a separate contract, will be handed over to private sector entities after the conclusion of the Games.
“The keystones of the plan are to encourage community participation in sports leading to the overall development of a sporting culture in the capital, the self-sustainability of each facility so as to provide a model for development and operations of future sports infrastructure in the country and world-class maintenance of the each facility,” the Request for Qualification (RFQ) issued by the ministry states.
According to the proposed contract, the selected entity will get rights to use the facilities for sporting and allowed non-sporting activities so as to ensure sustainability of the projects. The probable sources of revenue for the private entities could be event hosting fee (for sporting and non-sporting events), club revenues, rent from built-up space and naming rights (as per the terms and conditions of the proposed concession agreement).
“We’ll be handing over the stadia on 10-year licences to the corporates. Both parties will of course have an exit clause in the contract. The RFQ has already generated a reasonably good response and we expect more to pour in before the last date for application which is August 23,” Pravir Krishn, joint secretary in the sports ministry, told this newspaper on Saturday.
The government is only interested in inviting serious players, placing a Rs 1,000 crores net worth requirement for companies that are interested in bidding for Jawaharlal Nehru Stadium and the Indira Gandhi Sports Complex and Rs 500 crores net worth for the other three venues.
“We only want genuinely interested bidders. These are all well-placed assets and an initiative like this will herald a new beginning for sports. Till now the government has been doing 99 per cent of the work, it is time for the corporates to contribute as well,” Krishn added.
Sources indicate newly-formed joint venture IMG-Reliance could be one of the interested parties in the bid. But other corporates are still sceptical about the project.
“If a company is making a major investment like this it will not be interested in just maintaining the stadia. They will like to change it according to their requirement. It will be interesting see the goverment’s revenue generation model,” a senior official of a leading real estate company said.
For the corporates, cricket is still the primary source of assured revenue. “If it was a cricket stadium, corporates would not think twice. Football and hockey follow in that order, but these also have limited viewers in this country.
“Opening high-end clubs at these venues is an option, but apart from the JN Stadium these are not centrally located. In addition to this, you need to create a certain ambience for your exclusive clientele, which may not be possible here,” the official added.
To maintain these magnificent structures after the Games, the Ministry of Sports and Youth Affairs has come up with a ‘Legacy Plan’ that involves Public Private Partnership (PPP) for operations and maintenance of these stadia. Under the plan, each stadium, under a separate contract, will be handed over to private sector entities after the conclusion of the Games.
“The keystones of the plan are to encourage community participation in sports leading to the overall development of a sporting culture in the capital, the self-sustainability of each facility so as to provide a model for development and operations of future sports infrastructure in the country and world-class maintenance of the each facility,” the Request for Qualification (RFQ) issued by the ministry states.
According to the proposed contract, the selected entity will get rights to use the facilities for sporting and allowed non-sporting activities so as to ensure sustainability of the projects. The probable sources of revenue for the private entities could be event hosting fee (for sporting and non-sporting events), club revenues, rent from built-up space and naming rights (as per the terms and conditions of the proposed concession agreement).
“We’ll be handing over the stadia on 10-year licences to the corporates. Both parties will of course have an exit clause in the contract. The RFQ has already generated a reasonably good response and we expect more to pour in before the last date for application which is August 23,” Pravir Krishn, joint secretary in the sports ministry, told this newspaper on Saturday.
The government is only interested in inviting serious players, placing a Rs 1,000 crores net worth requirement for companies that are interested in bidding for Jawaharlal Nehru Stadium and the Indira Gandhi Sports Complex and Rs 500 crores net worth for the other three venues.
“We only want genuinely interested bidders. These are all well-placed assets and an initiative like this will herald a new beginning for sports. Till now the government has been doing 99 per cent of the work, it is time for the corporates to contribute as well,” Krishn added.
Sources indicate newly-formed joint venture IMG-Reliance could be one of the interested parties in the bid. But other corporates are still sceptical about the project.
“If a company is making a major investment like this it will not be interested in just maintaining the stadia. They will like to change it according to their requirement. It will be interesting see the goverment’s revenue generation model,” a senior official of a leading real estate company said.
For the corporates, cricket is still the primary source of assured revenue. “If it was a cricket stadium, corporates would not think twice. Football and hockey follow in that order, but these also have limited viewers in this country.
“Opening high-end clubs at these venues is an option, but apart from the JN Stadium these are not centrally located. In addition to this, you need to create a certain ambience for your exclusive clientele, which may not be possible here,” the official added.
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