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IS THE ADVERTISING AGENCIES RING ROBBING CRORES OF RUPEES FROM THE STATE EX-CHEQUERS

ronak-advertisement-2Looks like the advertising mafia that has haunted the NMMC Treasury perhaps since its inception is at work again. This has come to light in a new proposal drafted by the Navi Mumbai Municipal Transport for approval of the NMMT Committee, which stinks of another scam in the making. If the committee does approve this proposal that favours one advertising agency of the city, it will establish how advertising agencies continue to rob revenue of NMMC with the blessings of political parties. NMMT is all set to favor Ronak Advertising – the illegal bidder for advertisement rights on NMMT buses at over an estimated Rs.100 Crores loss to the municipal corporation. Prior to this, NMMT had advertised for bids for advertising rights on 356 buses for 5 years. Only one agency, ‘Proactive In and Out Advertising Limited’ bid for the same inspite of advertising for the contract a second time in leading newspapers Maharashtra Times and Economic Times. Instead of studying why the response was poor or was the advertisement in Maharashtra Times and Economic Times a wrong option, the NMMT administration entertained a proposal of Ronak Advertising in writing offering 10 Volvo Buses worth Rs.8 Crores and construction of 10 AC bus shelters. What’s shocking is that in exchange for this NMMT will give Ronak Advertising advertizing rights on all the 356 buses and the 10 bus shelters for 10 years ! Take a look at how the agency will make big bucks out of the tender process? NMMT earned Rs. Rs. 63.08 lakhs in 2008 – 2009 from advertising revenue from buses. This figure dropped last year when NMMT earned Rs. 61.36 lakhs in 2009 – 2010. At the present advertising cost on one Volvo bus of Rs. 1.70 lakhs per month. So 1 Volvo Bus will give Ronak Advertising a minimum revenue of Rs. 20.40 crores in 10 years. Of the 356 NMMT Buses, even if we assume that 200 buses out of the 356 buses find advertising clients, at the present market rate of Rs. 25,000 /- per bus Ronak Advertising will earn Rs. 60 crores in 10 years if this proposal is approved by the NMMT Committee. When we spoke to NMMT General Manager Jitendra Papalkar, he did not have any convincing reply for accepting a written offer instead of going by the tender procedure and norms. What is strange is a contract that promises over Rs. 7.5 crores in advertisement revenue annually finds only one bidder and the NMMT administration is evidently keen to accept a written offer to disqualify the bonafide bidder. However on this also, the NMMTV General Manager had a lame excuse he said that they also entertain first cum first serve basis in special cases. We met Amardeep Singh – the proprietor of Ronak Advertising and G Advertising who defended their undervalued bid for advertising rights on all NMMT buses for 10 years by stating that they made the offer only after NMMT got no response. He went on to add that they are offering NMMT 10 Volvo buses and 10 AC bus shelters. When we questioned him about making an under valued bid, he defended the same. No matter what Amardeep Singh says, even simple mathematics exposes that Rs. 8 Crores for getting advertisement rights on NMMT buses for 10 years is definitely under valued bid where the NMMT stands to lose Rs. 100 Crores to count the least. Who doesn’t know that the advertising agencies in Navi Mumbai are often alleged to work as a syndicate of advertising mafia that form a ring to get advertising rights of hoardings, banners, posters, kiosks, NMMT buses and bus shelters. Sources from NMMC administration allege that this ring has political blessings and has such an influence on NMMC that any outside advertise agency is not allowed to enter the market in Navi Mumbai even as these agencies continue to make under-valued bids for advertising rights thereby robbing a major source of revenue for NMMC through advertisements. And one name that finds prominence in these controversies and allegations are Ronak Advertising and G Advertising. Evidently Amardeep Singh refuted the allegations of forming a ring and working in as a syndicate. It is also alleged that the same advertising agencies are using their political clout to delay a decision on the “hoarding policy” that has been drafted but is gathering dust in NMMC. On one hand Thane Guardian Minister Ganesh Naik says that taxes will not increased for another 15 years so to meet development funds requirements NMMC has to tap revenue loss from advertising sector. But ruling party corporators themselves are said to be opposing the hoarding policy that will regulate big bucks that advertising agencies are taking home even as NMMC is suffering huge losses. Amardeep Singh however pushes the blame of this on the NMMC administration. There is no denying that the acceptance of this offer of Ronak Advertising without bidding for the said tender would set a wrong precedent as it violates basic tender contract norms. It will also end in a loss of revenue of 100s of Crores of Rupees for NMMC. It will be a wait and watch to see whether the NMMT Committee members approve the shady offer of Ronak Advertising that spells huge loss of revenue for NMMT. What happens will answer whether this proposal is a general apathy, ignorance and negligence of corporators or deliberate connivance with the advertising agencies to rob corporation revenue while vested interests make multi-crore profits. Sana Warsia NMTV News.

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