50% of creative sector reported a 51% or more loss in annual revenue in 2020-21: Report

The British Council, FICCI and Art X Company have jointly launched the third edition of the Taking the Temperature report. The report offers a quantitative mapping of India’s creative economy and culture sector – in the organised and unorganised sectors – across advertising, literature, crafts, festivals, performing arts and other art forms. The final edition is a series of three reports and a culmination of 18 months of mapping the sector. The research tracks the longitudinal impact of the pandemic on India’s creative and culture industry and identifies a way ahead in a systematic and sustainable roadmap for recovery. The pioneering research is a first-of-its-kind, the extensive report outlines the monetary size and scale of the creative economy and the contribution of the cultural industries to the national GDP and wealth creation in India.

British Council works with the Indian stakeholders to strengthen India’s creative economy and create sustained livelihoods for Indian creative professionals. The report which has been launched by Barbara Wickham OBE, Director India, British Council along with Rashmi Dhanwani, Founder-Director, The Art X Company and Sanjoy Roy Co-chair, Creative and Cultural Industries, FICCI aims to gather credible information and insights that can enable businesses and governments to make effective and well-informed decisions about public and private investment in the creative sector.

Key findings of the report:

India’s creative economy reduced to INR 30,440 crores GDP in 2021 from INR 50,000 crores GDP in 2020, pre-Covid
The advertisement industry which had a market size of INR7,000 crores saw a rise of 3.5 per cent in 2020-21. It includes advertisement revenues generated from digital and over-the-top (OTT) media, out-of-home, TV, films (in-cinema ads), and print.
There was a 39% recession in creative industries to INR 30,440 crores in 2021
50% of creative sectors reported a 51% or more loss in annual revenue in the financial year 2020-2021
89% of creative sectors in TTT2 and 82% in TTT 3 have confirmed the pandemic impacted their income
During Covid-19, advertisement spending saw an increase in the number of advertisers across sectors post-October 2020 (as compared to pre-Covid-19). However, Covid- 19 accelerated the shift to digital, so the share of digital advertising is expected to grow to 15 per cent – almost two years ahead of earlier projections. The recovery for this industry was led by an increase in the number of advertisers and the entry of new-to-TV advertisers (such as White Hat Jr Technologies and Practo).
49 per cent of creative sectors have not been able to keep creative businesses and artistic programmes running in the financial year 2020-2021
The Indian M&E sector fell by 24 per cent to INR1.38 trillion; Historically, M&E as a sector grown and often outperformed India’s nominal GDP, the sector fell 3x times India’s nominal GDP fall of 8 per cent due to the discretionary nature of the spending. Subscription revenues, however, proved their mettle by holding up better than advertising revenues
94 per cent of arts sectors are now operating in ‘digital only’ or ‘hybrid’ models
27 per cent of the sector is generating income through digital platforms with only 8 per cent running physical programmes.

In view of the findings and the feedback from the creative industry workforce and stakeholders, the report makes the following recommendations:

Establish a cross-government creative economy Task Force from the 14 Ministries that have a mandate for arts and culture in India
Government emergency grant-in-aid for MSMEs
A comprehensive national skills campaign across urban and rural geographies for creative MSMEs in digital and technological skills, business development, marketing and communication capacity
Establish sector-specific management, self-help groups and management organisations and city-wide enterprise zones and clusters
Establish arms-length bodies (ALBs) to strengthen and invest in arts and culture through a partnership of public and private investors.
Embed tax coding of the creative industries in the formal economy through the Goods and Services Tax (GST) council

Jonathan Kennedy, Director of Arts India, British Council, explains, “Since the onset of Covid-19, we’ve dedicated our research to understand the impact of the pandemic on India’s creative and cultural economy with FICCI, Art X Company and Smart Cube. The final report makes practical recommendations for the short and long-term recovery of creative sectors and livelihoods. While our first two reports measured the impact of the pandemic on the incomes of the professionals and culture organisations, the third edition offers a definitive mapping of the scale and significance of the creative economy in India.”

“We hope recommendations for recovery of the creative economy will be implemented through governance, infrastructure development and India’s enduring self-reliance,” he adds.

Rashmi Dhanwani, Founder-Director, The Art X Company comments, “This final leg of the Taking the Temperature survey underscores the hard journey that the cultural sector in India has been on. Not only has the sector lost more than 50% of its income, but its performance has also affected India’s GDP growth. Besides the economic impact, the loss of lives and livelihoods that the pandemic has caused begs an urgent intervention – India’s culture sector needs a voice and demands urgent regulatory frameworks to safeguard this vital part of India’s identity.”

Sanjoy Roy, Co-chair, Creative and Cultural Industries, FICCI says, “The TTT report on the Creative sector underlies the vital nature and impact of this sector and its potential in creating jobs, contributing to local economies and creating a platform to realise one full potential.”

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