Ahmedabad is not an outlier. Though it has seen the sharpest spike, the World Cup has pushed up prices across participating cities.
“Services inflation will be impacted for sure as prices of airline tickets and hotel accommodations have gone up for this period,” said Bank of Baroda in a recent note. Also, the prices charged by the informal segment in the services sector, which is not tracked in the CPI index, would show a substantial increase. However, this would be restricted to these 10 cities for the period of October and November only. As these trends are also witnessed during these months due to the seasonal impact of the festival season, it is hard to separate the impact of the World Cup.
The upward bias in inflation on this score could be between 0.15% and 0.25% for these two months, according to the Bank of Baroda estimate.
In terms of impact on GDP, with an estimated additional output of Rs. 18,000–22,000 crores attributed to the World Cup, the impact on gross value added is estimated to be around Rs 7,000–8,000 crore, according to estimates calculated by economists at the Bank of Baroda.