With the shift of venue of its principal activity, the Indian Premier League is now a full-fledged transnational outfit. If market gossip has a minimum veracity, it promises to emerge soon as one of the richest of the species. Despite the size of its turnover, the IPL is not a corporate body though, it has not registered itself as such. It continues to masquerade as a sports body, operating under the umbrella of the Board of Control for Cricket in India. The anatomy of this curious animal invites some dissection.

Apart from the personnel constituting its managerial core, there is nothing particularly Indian any more about the IPL. This is hardly surprising: it is in the nature of a transnational corporation to walk away from its roots, although the roots are never totally severed. The teams affiliated to the league bear Indian names. Their composition is, however, cosmopolitan, or, if the lingo currently in vogue is to be used, global; Indian players are in a minority in a fair number of them. Most of the teams have coaches and trainers from overseas. This is equally true of their captains. The financial transactions that take place under the auspices of the IPL are in the universally recognized international currency, the American dollar. The coaches, the trainers and the players are paid their fabulous fees in this currency. The stadia and other facilities being rented this season for the fixtures scheduled in South Africa will no doubt also be paid for in American dollars.

What is remarkable is that the income accruing from the IPL matches will be generated overwhelmingly from within India. There is immense passion for cricket in Australia, New Zealand, the West Indies, Sri Lanka and South Africa, but these countries are not hugely populated; the number of those watching cricket both live and on the television screen is unlikely to exceed a few paltry millions in the aggregate. Pakistan could have offered a more substantial clientele; that country, however, has at the moment other priorities. The density of cricket-watchers in the total population is relatively greater in the United Kingdom. The British, though, remain an archly conservative country in so far as taste for the Twenty20 version of the game is concerned. One can lay a wager that on most of the days the league fixtures are played in South Africa, the stands will be near-empty. This will be in stark contrast to what took place in India when the IPL I was on: whether it was Jaipur or Calcutta or Bangalore of Mumbai or Hyderabad, the stands were over-full.

The gravy really lies in the telecasts. Indians will not have the opportunity this time to crowd the stadia to watch the IPL II fixtures. So what, the total number watching the games on the TV screen — and therefore the advertisements displayed between the overs and the two innings — will on the average touch, according to one estimate, close to 300 million. Of this, roughly one-half will belong to the category known in the trade as ‘sleeping watchers’, that section of viewers who gaze at the ‘commercials’ but lack the purchasing power to go to the market and buy the goods and services that are advertised. However, the other half of the watchers — 150 million or thereabouts — have conceivably a total purchasing power approximating to that of entire Western Europe. Advertisers know what is what; now that the IPL has arrived, they will pay through the nose to spread the charm of their goodies even as the T20 games are shown on the TV screen. As they buy up TV time, dollops of money flow in to the coffers of the body owning the franchise for the telecasts. That body, in its turn, will pay through the nose to the IPL.

This is where questions crowd in, for a haze hovers over the relevant facts. The community at large may like to know a bit more than just the nitty-gritty of the financial transactions at different levels. How much money the IPL is going to earn by selling the telecast rights is not easily obtainable. Nor is information on tap on the kind of arrangements worked out between the IPL and its constituent teams. Details of the wage bill on account of foreign players, coaches, trainers, physiologists and so on should also be in the realm of public knowledge, but are not. So is the case with the audited accounts of the net takings of the Indian Premier League, and their breakdown under different heads of income and expenditure.

Were such data laid bare, the possibility is indeed high of coming across some extraordinary anomalies. The IPL is, to all intents and purposes, an out-and-out business enterprise, in effect a transnational set-up. It nonetheless keeps flaunting itself as a sports body. Since it is not registered as a corporate outfit, the corporate laws are apparently not applicable to it, and this in spite of its making mountains of money that is the envy of many business houses. Yet, other puzzles abound. Since a large proportion of the IPL’s spending goes in payments to coaches, trainers and players who are foreign citizens, in leasing hotels and stadia in a foreign country as well as in foreign travel expenses, a considerable amount of foreign exchange outlay is involved. Whether such spending in foreign exchange requires the nod of the Reserve Bank of India is not altogether clear. In the past, the tax authorities used to decide on the foreign exchange outlay needed by a corporate entity to carry out its normal activities over a given period. Such norms have been relaxed in the liberalized milieu, and in any case the IPL will perhaps persist in claiming the privilege of a non-profit making agency.

Even so, it will be interesting to know the criterion applied to judge the worthwhileness of the lavish expenditure in foreign currency it is indulging in. After all, the bulk of the income from out of which such spending is taking place is sourced within the country. Even if the IPL drags its feet to register itself as a corporate body, is there not some way to make it pay the due taxes on its huge profits? And notwithstanding the double taxation agreement with South Africa, cannot the foreigners who make a beeline for the IPL be persuaded to pay taxes in India on their mind-boggling earnings?

Those who love to delve into the mystique of national income estimation will have plenty of fodder to chew on from the affairs of the IPL. For example, will the income accruing to it from the league fixtures held in South Africa be reckoned as accretion to India’s national income, but not to its domestic product? Will the various payments made by the IPL on the soil of South Africa add to the gross domestic product of that country?

The primary task, it would still seem, is to slap an order on the BCCI — or at least on the IPL — asking it to register itself as a corporate entity, thereby rendering it amenable to the discipline of the Company Law Board. It is by no stretch a not-for-profit organization, it is not a private charitable trust either. Cricket has anyway ceased to be a sport; at least its T20 version is more like gambling. Gambling, even where allowed, is heavily taxed. No reason exists why the Twenty20 entertainment should be permitted to opt out of that obligation. But, who knows, a part of the profits the IPL is piling up is possibly being set aside to please the deities who decide on such matters as tax liability.

Besides, why forget that the tax haven, Mauritius, is just one hop from South Africa?