CAG report reveals IOA incurred huge loss due to faulty agreement with Reliance

The CAG report also added that the sponsorship deal gave undue favour to RIL.

A recent audit by the Comptroller and Auditor General (CAG) has revealed that the Indian Olympic Association (IOA) lost Rs 24 crore due to a “faulty” sponsorship agreement with Reliance Industries Limited (RIL).

The report, released on September 12, criticized the IOA for not protecting its own interests when amending the agreement with RIL in December 2023.

According to a report in the Hindustan Times, the deal signed on August 1, 2022, made RIL the “Official Principal Partner” for major sporting events that include the Asian Games, Commonwealth Games, and Olympics in 2022 to 2028. RIL also were given rights to build and show ‘India House’ at all of the above events.

A renewal signed in December 2023 added four more events — Winter Olympics (2026, 2030) and Youth Olympics (2026, 2030) — but the CAG report said the IOA did not add any value to the deal, which still stood at Rs 35 crore despite the addition of four new events.

“The IOA should have raised the consideration amount from Rs 35 crore to Rs 59 crore as the consideration amount of rights of six games was Rs 35 crore, calculated on an average of Rs 6 crore per games,” the CAG report stated, as quoted by the National Daily.

The auditors criticized the IOA for not protecting its interests, stating, “Thus, there was loss of Rs 24 crore to IOA due to faulty agreement with RIL and undue favour to RIL.”

The IOA President PT Usha, has been asked to explain the findings of the CAG. Ajay Kumar Narang, Usha’s executive assistant, defended the agreement citing changes in International Olympic Committee (IOC) rules regarding sponsor naming rights.

Also Read: IOA president PT Usha slams executive committee for not felicitating Paris Olympics medallists

Narang said, “When the agreement was signed and naming rights were granted, it was in the name of sponsors — Reliance India House. In 2022, the International Olympic Committee allowed sponsors name with the country house. But in 2023 the IOC changed the conditions to say that the sponsor cannot use a name and it will have to be a country-named House.”

Narang added that RIL had demanded compensation for less visibility and was offered the supplementary rights. The only reason India participates in the Winter and Youth Olympics is much lesser in number compared to the Summer Olympics, he added, adversely impacting the value of sponsorship.

However, IOA treasurer Sahdev Yadav raised concerns about the decision-making process. “RIL has benefitted and it is not in the knowledge of the executive board or finance committee and sponsorship committee. The president should answer why the agreement was changed and who signed it? It has led to a loss of Rs 24 crore to IOA. This should not have happened,” Yadav said.

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