Another crucial component of the 2010 Commonwealth Games - procuring sponsorships for the event - seems to be getting derailed. The Singapore-based Sports Marketing and Management (SMAM), with whom the Organising Committee (OC) had signed a contract for negotiating and procuring sponsorship and licencing contract, has failed to generate adequate sponsorships.
The contract was inked in 2007. SMAM had at the time of signing the contract promised to raise sponsorship worth R 470 crore (US $100 million). Of this, it has so far managed to get R 125 crore.
Adding insult to injury, the flawed contract agreement that the organising committee signed with SMAM has ensured that despite the latter failing to deliver, it will get commission from sponsorship that it did not procure on its own (like those coming directly to OC from public sector undertakings). PSUs such as Air India, Central Bank of India, NTPC and Railways have committed sponsorship worth R 250 crore.
Sources say in a recent meeting, unhappy with SMAM's performance, the OC was mulling terminating its agreement but was advised against it by its legal team.
"The exit clauses of the agreement are very tough. If we scrap it, we will not only end up paying money to the company but the latter has threatened to go into arbitration against us," said a source.
Hemmed in from all sides, OC could only tell SMAM that it was not making enough effort and has asked it deliver.
The OC sources say not only has SMAM failed to deliver but it is also using the flawed contract to get commission from sponsorship it did not procure on its own.
Of the R 125 crore that SMAM has managed to raise so far, R 36. 5 crore is value in kind. For instance, Swiss company Omega will be providing all TSR (Testing Scoring Result) gadgets worth R 19 crore, while Agility, an international logistic firm is providing logistical support to the game. Amity International is providing training to volunteers at a total cost of R 5 crore.
"There were loopholes in the contract. The OC should have drafted the agreement more carefully to safeguard its interest. This was not done," said an official, requesting anonymity.
Lalit Bhanot, OC spokesperson, said, "I cannot comment on this. I do not carry figures with me all the time. I will have to find out."
The contract had clauses for commission that sources say was very high. Also, according to the contract, the OC had agreed that the total income tax liability of SMAM under the income tax Act will be limited to 10.54 per cent.
Saturday, July 31, 2010
Games must fail. That's the plan
Suresh Kalmadi, chairman of the Commonwealth Games organising committee, is a sad man. Not because his stadiums are falling apart - and filling up with rainwater. But because the people of his nation, for whom he has worked so hard and sacrificed so much, have turned on him. As if they actually don't see the big picture. Not the former big picture - of national glory accruing to India as She competed with world powers for the title of best sports host. That was, of course, never a battle we were looking to win.
So when one-time (albeit unwilling) sports minister and current Rajya Sabha member Mani Shankar Aiyar said he hoped the Commonwealth Games failed, Kalmadi was not really surprised.
In fact, it was the cue for the people of his country to rise up as one and pour out their hearts in support of his nationalist cause.
What hurt was the eerie silence in the stands, with just a stray cricket chirruping disapproval.
Not only was no one cheering for him and his Titanic-like endeavour, they were actually turning their backs on him all the better to shake Aiyar's hand and thank him for his honesty.
Did they not see, Kalmadi asked the lone cricket, that he had worked so hard, orchestrated this failure so exactly with the best interests of the nation in mind?
After all, we cannot really afford to host an international sports meet. We, who have tonnes of foodgrain rotting for want of a decent godown. Who can barely afford to keep our ministers fed, clothed, automobiled and helicoptered.
So the plan, he told the disapproving cricket, was to put on a show of valiant effort. Then fail so spectacularly that no one ever offered us the opportunity to host more than a kabaddi match.
And that - the failure and the resultant savings of thousands of crores of rupees that we would have otherwise spent on future international games and tournaments - was just Phase I.
Kalmadi's plan was much broader. We would fail, save the crores that foolish China, for instance, will be forced to spend as they try to outdo to their stupidly spectacular Olympic affair, and yet we would seem to die trying. As we stepped back from our (un)finished product just in time to cancel the Games, having spent Rs 35,000 crore on our valiant effort, the world would gape in horror and sympathy.
Eager tourists would flock to our Capital just to see for themselves how hard we had tried, and to verify that the skeletons of stadii were, in fact, where we had hoped to host the world.
That was Phase II.
Phase III was to follow soon after. Having seen the horror for themselves, the developed nations of the world would feel compelled to help.
Aid would begin flooding in, with UN funds snatched from starving sub-Saharan Africans so they could be sent our way. China would send us entire stadiums, draped in black as a sign of mourning. The US would recall its Black Hawks from Afghanistan and sell them to the nearest Saudi prince just so we could make back a little bit of what we had spent.
In our spectacular failure would lie our success. Our rebirth. The rebirth (or birth, let's be honest) of a truly vibrant sporting culture funded by countries that really care.
This was the plan all along. It has to have been. What other explanation is there?
Source: Hindustan Times
So when one-time (albeit unwilling) sports minister and current Rajya Sabha member Mani Shankar Aiyar said he hoped the Commonwealth Games failed, Kalmadi was not really surprised.
In fact, it was the cue for the people of his country to rise up as one and pour out their hearts in support of his nationalist cause.
What hurt was the eerie silence in the stands, with just a stray cricket chirruping disapproval.
Not only was no one cheering for him and his Titanic-like endeavour, they were actually turning their backs on him all the better to shake Aiyar's hand and thank him for his honesty.
Did they not see, Kalmadi asked the lone cricket, that he had worked so hard, orchestrated this failure so exactly with the best interests of the nation in mind?
After all, we cannot really afford to host an international sports meet. We, who have tonnes of foodgrain rotting for want of a decent godown. Who can barely afford to keep our ministers fed, clothed, automobiled and helicoptered.
So the plan, he told the disapproving cricket, was to put on a show of valiant effort. Then fail so spectacularly that no one ever offered us the opportunity to host more than a kabaddi match.
And that - the failure and the resultant savings of thousands of crores of rupees that we would have otherwise spent on future international games and tournaments - was just Phase I.
Kalmadi's plan was much broader. We would fail, save the crores that foolish China, for instance, will be forced to spend as they try to outdo to their stupidly spectacular Olympic affair, and yet we would seem to die trying. As we stepped back from our (un)finished product just in time to cancel the Games, having spent Rs 35,000 crore on our valiant effort, the world would gape in horror and sympathy.
Eager tourists would flock to our Capital just to see for themselves how hard we had tried, and to verify that the skeletons of stadii were, in fact, where we had hoped to host the world.
That was Phase II.
Phase III was to follow soon after. Having seen the horror for themselves, the developed nations of the world would feel compelled to help.
Aid would begin flooding in, with UN funds snatched from starving sub-Saharan Africans so they could be sent our way. China would send us entire stadiums, draped in black as a sign of mourning. The US would recall its Black Hawks from Afghanistan and sell them to the nearest Saudi prince just so we could make back a little bit of what we had spent.
In our spectacular failure would lie our success. Our rebirth. The rebirth (or birth, let's be honest) of a truly vibrant sporting culture funded by countries that really care.
This was the plan all along. It has to have been. What other explanation is there?
Source: Hindustan Times
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