The confluence of faith and finance has sparked debate in India, particularly regarding the Maha Kumbh Mela's influence on the nation's economic growth. The Kumbh Mela, a Hindu pilgrimage held every 12 years, is one of the largest human gatherings on Earth. The 2025 edition, held in Prayagraj, Uttar Pradesh, attracted a staggering number of devotees and generated considerable economic activity, leading to questions about its impact on India's Q4 GDP growth.
India's Chief Economic Advisor (CEA), V. Anantha Nageswaran, has weighed in on the matter, acknowledging the potential boost to consumption expenditure during the March quarter due to the Maha Kumbh Mela. He noted that the event likely spurred significant economic activity. Echoing this sentiment, the Finance Ministry, in its monthly economic review for March 2025, suggested that India's economic growth likely accelerated in the January-March period, driven by improved export growth, increased government capital expenditure, and the economic impetus associated with the Kumbh Mela.
A report by Dun & Bradstreet estimated that the 2025 Kumbh Mela facilitated ₹2.8 trillion in economic output through direct, indirect, and induced channels. Direct impact includes attendee expenditures on transportation, accommodation, food, tourism services, and local commerce, estimated at ₹900 billion. Transportation alone accounted for nearly 50% of direct consumption expenditure, or about ₹370 billion. Accommodation generated an estimated ₹60 billion in economic activity, while food services accounted for ₹65 billion. Retail trade generated an estimated ₹70 billion through over 200,000 vendors. The indirect impact, stemming from the supply chain's response to increased demand, is estimated at ₹800 billion. The induced impact, amplified economic activity due to increased income, is estimated at ₹1.1 trillion.
The Uttar Pradesh government invested significantly in infrastructure for the Kumbh Mela, allocating ₹5,400 crore, with an additional ₹2,100 crore from the central government. These investments in roads, flyovers, and underpasses improved connectivity and benefited surrounding districts. Uttar Pradesh Chief Minister Yogi Adityanath estimated that the Kumbh Mela would contribute over ₹3 lakh crore to the state's economy.
However, some argue that the economic benefits of the Kumbh Mela are overstated. A 2019 study by Prayagraj University found that for every $1 spent at the Kumbh Mela, only a small fraction remained in the local economy long-term. Another study indicated that the multiplier effect of religious tourism in India is weaker than in manufacturing, suggesting that money circulates briefly but does not lead to sustained growth. Furthermore, a 2022 survey found that a significant percentage of rural pilgrims borrowed money or drew from savings to attend the Kumbh Mela, leading to a decline in household income after the pilgrimage.
Despite these concerns, recent data indicates that India's GDP growth for Q4 FY25 stood at 7.4%, exceeding expectations. Real GDP is estimated to grow by 6.5% in FY 2024-25. Sectors such as construction, public administration, and financial services recorded strong growth rates. While the Kumbh Mela may have contributed to this growth, other factors, such as government spending, agricultural output, and private consumption, also played a significant role.
In conclusion, while the Maha Kumbh Mela undoubtedly generates significant economic activity, its precise contribution to India's Q4 GDP growth remains a subject of debate. The event's impact extends beyond immediate financial transactions, influencing infrastructure development, employment, and tourism. However, concerns about income distribution, long-term economic benefits, and environmental sustainability must be addressed to ensure that such events contribute to inclusive and sustainable growth.
