Government-led advertisement revenue is a crucial source of income for Indian media houses. However, data indicates that the total expenditure incurred by all Central Government ministries in the National Democratic Alliance (NDA)‘s second term between April 2019 and December 2023 amounts to just ₹1,892 crore. This is 64 per cent lower compared to ad spends in the NDA’s first term. 

Data from the Central Bureau of Communication (CBC) shows that during the Congress-led United Progressive Alliance’s term (FY10 to FY15), approximately ₹3,471 crore was spent on advertisements. This figure increased by 53 per cent to ₹5,324 crore during the Bhartiya Janata Party-led NDA’s first term (FY15 to FY20).

The government incurs annual expenses on media advertisement to garner support for its policies.

Paritosh Joshi, Principal, Provocateur Advisory, said, “Government spending on media ads decreased due to the Covid crisis, with the state’s primary focus being on providing essential services in response to health emergencies. Consequently, spending on media advertisements became less important for the government. Also, much of the government spending in the past few years has shifted towards digital organisations such as Alphabet and Meta.”

According to the data, government-sponsored ad spending on media in FY2019-20 amounted to around ₹632 crore. This figure decreased by 20 per cent to ₹307 crore in FY2021-22. By FY2023-24, the spending declined further by 57 per cent to ₹168 crore.

Business & Brand-Strategy expert Harish Bijoor said, “The government’s key priority has shifted in the last few years from traditional media to digital mechanisms such as social media due to its wider audience reach and the option to editorialise ad content on social media.”

Joshi explains, “Two important factors are at play here. Firstly, there is no pressure on the Central Government to spend on media advertisements, as media houses are generally supportive of the state’s governance policies. Secondly, it is crucial to consider the state government’s spending on advertisements, as states such as Uttar Pradesh and Maharashtra might have also invested in advertising to maintain a balance.”

According to media reports, the Maharashtra government allocated nearly ₹330 crore for media advertisements between 2019 and 2022, while the Uttar Pradesh government spent approximately ₹160 crore from 2020 to 2021.

Expenses on print and electronic media remained at the same level, with a small portion allocated to outdoor media.

A former employee of government-owned media said, “People are increasingly turning to digital mechanisms such as OTT platforms or podcasts, which could be a reason why advertisements have decreased in traditional electronic media, mainly television or radio.”

According to CBC data, a significant portion of advertisement expenditure has been directed towards major English and Hindi media outlets, both in the print and electronic formats.

“Local media outlets have suffered significantly due to spending cuts on ads, as a substantial amount of money has been allocated to large, established media organisations,” Joshi added.

The ministry-wise allocation of media advertisement expenditure reveals that the Ministry of Information and Broadcasting spent ₹181 crore in FY2018-19, which decreased to ₹73 crore by FY2023-24. Similarly, the Ministry of Finance allocated ₹150 crore in FY2018-19, which decreased to ₹34 crore in the same time span.