Goal.com Economic Crisis Special (3) - Iran, India, Indonesia

In the latest in Goal.com's special series on how the global economic crisis is affecting football around the world, we turn the spotlight on three Asian giants...

While Iran is a nation that has already appeared at three World Cups and supplies players to top flight clubs in Spain, England and Germany, India and Indonesia haven’t branded themselves on the consciousness of the world of football – not yet anyway.

But all three nations have rich football histories as well as bright futures. Indonesia, under the guise of Dutch East Indies, was the first Asian country to appear at a World Cup back in 1938. India, a country that boast the third oldest domestic cup competition in the world, qualified for the 1950 tournament but famously never took the pitch in Brazil when they were informed by FIFA that playing in bare feet was not allowed.

Much has changed, these days, English clubs are flocking to the sub-continent. High-ranking officials from Manchester United, Tottenham, Everton, Arsenal and Chelsea have been pressing flesh in Delhi, Mumbai and Kolkata in the last few weeks, hoping to get a piece of a football market that is expected to explode at any time.

It is not only English visitors that are lining up at Indian airports. Bayern Munich played in both India and Indonesia a few months ago, and as soon as the Germans left Jakarta, Roma moved in. Iran is not being ignored as Lazio officials were in Tehran in November.

That is all well and good but, domestically, can these Asian nations survive and even prosper in the midst of a global downturn? Goal.com chats to the people who should know.

Iran

Iran's football system means that clubs in the Iranian Premier League are not feeling the effects at all. The reason is simple: most clubs are owned by the government and all stadiums are state-owned or bankrolled  by state-owned industries.

"This arrangement means that the global economical crisis will only impact Iranian football if it impacts the country's GNP," says Kaveh Mahjoob of Goal.com Iran.

"Most of Iran's revenue comes from the oil industry. Despite all the recent economical hardships that western countries and emerging economies like China have been going through, the price of a barrel of oil today even at $66 is much higher than what it was a few years ago. The government will invest less in football, if the price of a barrel of oil returns to $20 or less.”

Sounds encouraging but with only Persepolis and Tehran rivals Esteghlal collecting revenue from television rights, most clubs follow their South Amerian counterparts and make money by selling stars to European or UAE teams. Iran’s football infrastructure needs serious investment to match the like of Japan and South Korea.

India

The same can be said of India but in South Asia, football is moving forward at a rapid rate. The local I-league is in its second season and is setting the foundations for a well-organised and professional set-up that could lift India up into the next level. Well, that is the plan but is it all being jeopardized  by economic events?

The answer seems to be a firm 'no' as Goal.com India’s Atishay Agarwal explains.

"Most Indian banks haven't suffered as much when compared to international companies. None of these are sponsoring any Indian clubs, so there have been no consequences of the global meltdown as yet. Even if things get worse around the moment, the mood in India is confident.

"Indian football seems to protected as the main sponsors of the I-League, ONGC, is an Oil company, which could suffer more because of rise in oil prices, which are on their way down right now. So the worst case scenario might be ONGC pulling out because of an exceptional rise in oil prices, which isn't likely to happen.

"Football in India is in safe hands financially at the moment but the All India Football Federation needs to be careful in choosing sponsors from now on because of the financial uncertainty, and not risk the future of the sport for the promise of a few extra bucks."

All in all, just like in China, business problems could help Indian football step out of the shadows of a rival – not Korea and Japan in India’s case but cricket.

"As of now, several companies are involved in cricket sponsorship, and spend outrageous sums of money for rather disproportionate returns. However, as the crisis starts affecting them, smaller companies might just decide against splurging on cricket events, when they can effectively sponsor a football event for even 10% of that sum of money. So, gradually, we could see a number of small to medium-sized companies investing in football in the near future."

Indonesia

Battling against another sport isn't a problem in Indonesia. Indonesians love football like few others in Asia but has always struggled to translate passion off the pitch to performances on it.

The present crisis is, like India and Iran, not affecting the archipelago too much at the moment but there are other problems however that will only get worse if the economy does. It is the lack of professionalism and management that is holding back the nation according to Bima Said of Goal.com Indonesia, though the international crisis is not going to help.

"Regardless of a global economic crisis, some clubs already face problems when it comes to money," says Said. “Last year, the central government prohibited local government from funding their local football club. Instead of receiving grants, clubs were supposed to receive loans that may or may not be paid back. Some clubs are now becoming privately owned clubs - Arema Malang, Pupuk Kaltim Botang, Pelita Jaya Purwakarta and Semen Padang to name a few - who end up doing quite well on and off the pitch."

Others have to follow this example.

"Clubs here have to realise that in order to survive and be independent, they have to maximise income through sponsorship, gate receipts and merchandising. All this is possible with professional management. They can no longer rely on government subsidies. Let clubs grow by being independent, professional, private funding. That is the way to go, because the football here, with plenty of money potential, is in a strong position to survive any form of crisis. It is time for the people who run the clubs to source alternate revenue streams.”

While the economic crisis has not yet reached Indonesia, according to Said, clubs are always in need of more money.

“If the ultimate aim is to develop a league that can compete with the best in the region surely it's better done on a firm financial basis. Fans in Jakarta can't support their team if they have to fly eight hours away to Papua for an away match. Besides, most of these fans can't even afford flight tickets and clubs can struggle too.”

“Now with the Superliga season almost half finished, clubs are already feeling the pinch. Even double winners Sriwijaya FC Palembang were unable to pay their players wages for two months. So one can imagine the devastation if the economic crisis gets worse.”

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John Duerden

john.duerden@goal.com