The profound impact of grand Indian celebrations ft. finfluencers

From tradition to a thriving industry, finfluencers Smit Thakkar, Shreya Jaiswal, and Chinmay Trivedi help us uncover the expansive economic influence of grand Indian celebrations.

India is known for its vibrant culture, celebrations, festivals, and weddings and it brings us together as a community. Over time, these celebrations have become a part of us in such a way that we can't imagine India without them. It is not just because they give us time to dress up, munch on delicious cuisines, and meet our families but also because of their profound impact on our economy. As these events are marked by lavishly splurging on clothing, jewelry, food, decorations, and more, they serve as a catalyst for various industries, stimulating economic growth and providing employment opportunities. The financial ripple effect of these celebrations is undeniable. To understand it deeply, we asked a few finance experts about the role of grand Indian celebrations on the economy. Scroll down to see how Smit Thakkar, Shreya Jaiswal, and Chinmay Trivedi simplified the concepts for us! 

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The overall picture of celebrations

We wanted to understand the overall picture of the grand celebrations in India and the industry that directly or indirectly gets impacted by them. According to Shreya Jaiswal,"The Indian wedding and festival industry is a multi-billion dollar industry with the numbers just growing with each passing year. In fact, there are a large number of small vendors whose entire year’s livelihood expenses are supported by the money they make in these 3-4 months of the festive season." Every part of the business, no matter how big or small has a crucial role to play in the economy. Shreya believes that from something as big as the hospitality industry to something as small as the invitation cards, each contributes significantly to the country’s GDP. "I was surprised when I recently read that the Indian wedding cards business itself is a Rs. 5000 crores industry. And wedding cards contribute to one of the smallest expenses in a wedding." This statistic itself shows that Indians, irrespective of their income, don’t shy away from spending a lot for marriages and festivals, which is also why the average Indian spends the majority of their income on their wedding. "Which is also the reason for the increase in personal loan for marriage expenses." 

Considering the bigger picture, it's not tough to guess how these celebrations have an impact on the consumer market as they provide numerous opportunities for labor and businesses. Smit Thakkar is of the opinion that Indian weddings hold cultural importance and reflect social status, creating many opportunities in event planning, catering, music, photography, and fashion. "Indian festivals are a boon for small and medium-sized enterprises (SMEs). I have observed that during major festivals like Diwali, Navratri, and Eid, there is a surge in demand for products like idols, decorations, jewelry, and fashion. Small businesses increase production, transitioning from traditional garments to trendy fashion, often hiring artists to match evolving trends."

We have also noticed the impact of cultural changes and trends on the way we celebrate. A lot has changed in the past few years. Speaking about the recent trends, Smit mentions that in recent years, pre-wedding shoots and destination weddings have been trending in Indian weddings. A pre-wedding shoot has become a tradition for most couples, influenced by what they see on social media from their favorite celebrities and influencers. "This trend has led to a surge in big, extravagant destination weddings, with a significant impact on the Indian economy. Destination weddings have not only benefited the photography, decoration, and catering businesses, but they have also generated substantial revenue for tourism, hospitality, and local businesses in these destinations."

Mentioning some trends that she has personally noticed, Shreya added, "One of the very evident trends is the size of the event. While festivals and events of general celebrations like Navratri have become more grand, private events like weddings have become smaller in size post the COVID-19 pandemic. But when I say smaller, it doesn’t mean that the expenditure per wedding has gone down." People now spend more on the details and aesthetics of their wedding venue, decor food, and more instead of spending on the number of people attending. "Social media fever is also one of the contributing factors to it. The grandiose in terms of details has eventually led to the birth of the wedding planner industry and given a significant push to the already existing event management business." This gives us a clear idea of how changing trends impact the market and help businesses adapt accordingly. 

Eco-friendly celebrations and how sustainability has entered in our celebratory discussions

Speaking of trends, one cannot avoid people opting for more sustainable and environment-friendly options in their functions. Smit believes that some might say that if such a trend takes place, it could have a negative impact on existing wedding and festival businesses. "However, my perspective differs. I know currently, in India, the trend of eco-friendly weddings and festivals is not very prominent, but slowly this concept is getting popular. It's likely that this trend will soon gain popularity in India as well. In the upcoming years, if this takes place, it will have a positive impact on the Indian economy. These types of celebrations involve the use of recyclable, reusable, and sustainable materials, which presents a great opportunity for manufacturers. It's possible that India could become a major hub for the export of such products."

Chinmay Trivedi thinks that it's good that people have started taking steps toward bettering our environment and it has helped a very different category of businesses to grow. He talks about one of his relatives getting married who used more recyclable or reusable items like vintage candles, glassware and plants to decorate their wedding. "Talking about the economy, it affects the already existing businesses but it gives an opportunity to new businesses and vendors who deal in eco-friendly products and as more and more people start to focus on eco products, the more these products are introduced to the market, it will lead to more job opportunities and this will always add to the economy because the consumer will pay GST on services, the guy who got a job opportunity might start paying income tax too."

When the culture transcends borders

Thanks to the power of the internet, learning about new cultures has become easier than ever before. It's evident how the vibrancy of Indian culture has appealed to people globally. We know that this helps cultural exchange, tourism and also our economy. To give us a clear idea. Shreya mentions that the richness in Indian culture has always been appreciated by the world. However today, with the rise of social media, and with the entire world witnessing the grandiose of our culture, not only are foreigners coming to India to experience these festivities, but a large number of these foreigners are also inviting planners, entertainers, artists, and more to introduce the Indian culture to their country. "Indian priests are also in high demand in the west due to the respect that our culture has gained during this social era. Not only does it strengthen the placement of our country in the world forum but also brings in a significant amount of foreign exchange into the country which is a significant contributor to the country’s growth and economic development."

But how does tourism impact the economy? Chinmay believes that all of us know that if something is hot, everyone wants to follow it, whether it's a fad or a Reel on Instagram. "Influencers and celebrities who uploaded their lovely moments on social media brought desire to those who were consuming their content, and I believe it is beneficial to India in all imaginable ways. The tourisism industry benefits greatly from destination weddings. Guests frequently stay at the chosen destination for an extended amount of time, spending money on lodging, food, transportation, and numerous activities. This inflow of visitors has the potential to benefit the local economy. Destination weddings have made previously underutilized or unknown areas more attractive. Couples are increasingly seeking exotic and out-of-the-way destinations, which has fueled the growth of tourism infrastructure in these areas. but yes there are also concerns about the environmental impact of this trend, as well as the potential for pricing out local populations in some regions. Balancing the rewards with the challenges is an important concern for both the wedding and tourism industries."

India is a diverse country, and it's big enough to surprise even the people who have been living here all their lives. Culture, languages, festivals and customs change as we travel through the country and of course how it affects how people celebrate. Addressing the same, Shreya mentions that regional variations will always exist in India due to the cultural diversity that we possess. "But you cannot rule out the importance of one region over the other. North Indian weddings are the classic example of big fat Indian weddings, however with the increased spending these families now prefer destination weddings in the southern or eastern parts of the country.

Talking about festivals, everyday is a celebration in India in different parts of the country. While we have Onam in September which is a festival celebrated by the South Indians, there is Gudi Padwa in April which is celebrated largely by Maharashtraians, and then we have occasions like Diwali which is the grandest festival celebrated by the entire country at one time and is also spoken about by the entire world." So fairly speaking, each part of India has their own set of contributions to the celebration industry, some by way of hospitality, some by way of entertainers, some contribute by giving revenue in the off-season while some contribute by having tourist attractions based festivals like the kumbh mela.

Understanding taxation and government policies:

Everyone, especially businesses who want to make the most out of these opportunities should know about government policies. Highlighting the basics of it, Chinmay mentions that government policies and taxation, such as the Goods & Services Tax (GST), extend their influence far beyond celebrations and weddings. "Many families now outsource services like catering and decoration, and the imposition of GST adds to the overall cost. Unfortunately, consumers can't claim GST credits for these events. Additionally, individuals interested in importing designer clothing and luxury goods often remain unaware of the import duties they'll have to pay, which significantly affects their buying decisions. Government regulations also shape our traditions and experiences. For example, the ban on firecrackers in some cities due to pollution concerns deprives children of the joy of bursting them.

This not only alters traditions but also leads people to explore alternative customs. Government policies have a profound impact on culture and economics, influencing the choices and experiences of individuals and communities." Smit Thakkar added to this. "Government policies and tax regulations do not impact only the wedding industry; they also have an impact on all events and sectors. There's no doubt that wedding gifts are tax-free, and wedding expenses are also tax-exempt under Section 56 of the Income Tax Act, 1961. A few years ago, wedding festivals were not affected by major taxation policies. However, after the introduction of GST, many things have changed. So, for weddings and festivals, when booking a venue or any services, people are now paying GST, which has led to a price hike."

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