Over the last five years, entry into Afghan markets has become tougher for both national and international ventures. Kabul is now turning into a confined market having legitimate laws for both fresh and experienced investors. The sports industry is one of the fastest growing businesses in the country attracting more investors. Cricket being one of the most liked sports in the country has increasingly developed over the last decade, as the Afghanistan national squad is highlighting on international platforms, therefore not only local, but foreign firms are also optimistic to undertake investments in the team.
In May 18, 2015, after a two-year gap sans sponsorship the blue team signed a ten-year agreement with Alokozay Group of Companies (AGC) a local Afghan enterprise to undertake sponsorship of the team, which opened a way for private sectors to officially sponsor the national team. Back then the team would get funds from the government, although Etisalat in the initial years would somewhat provide funds for the team.
AGC allocated a fund of $13 million to the team, the executive director of the Afghanistan Cricket Board (ACB) Shafiq Stanikzai said: “Sponsorship is crucial for the team’s survival, our talented players in the national team and junior teams have proven their worth in attracting this leading firm to invest”.
Rashid Khan and Mohammad Nabi, the renowned players on the side known in the cricket world for their remarkable performance, play for the Sunrise Hyderabad team in franchising games of Indian Premier League (IPL). Their journey to IPL has resulted in them being featured as brand ambassadors for several national and international companies. Mohammad Nabi recently signed an agreement with Azizi Bank, a local bank in Afghanistan.
The sprint progress of the blue squad is also attracting foreign companies, i.e. Amul Diary one of the major Indian companies that announced its sponsorship for the Afghan team, signed an agreement ahead of the World Cup 2019, which took place in England.
“Amul will be the principal sponsor of the Afghan cricket team in the coming ICC World-cup. We believe that Afghanistan will be a strong contender as it is the fastest growing team,” said Amul’s Managing Director Rupinder Singh Sodhi. Also, the chairman of the Afghanistan cricket board expressed in a press conference, “This is a big moment for the Afghan cricket team and we are extremely happy that Amul will sponsor us for the World Cup.”
The entry of foreign firms into the Afghan market gives stiff competition to the local firms, which has resulted in grabbing the attention of the local companies. not only business firms but also educational institutions showcase the future of prospect competition for domestic and international investors, i.e. Kardan University undertook sponsorship of the main jersey of the blue team in a recently held tournament between Afghanistan and West Indies.
- Foreign companies entering into Afghanistan for investment serve as a major driver for the enhancement of the country’s economy.
- Provision of the job opportunity.
- Opening routes to the multinational companies which will ultimately transform Afghanistan into a business hub.
- As foreign companies have started investing in Afghanistan, it would result in them avert progress of the local firms, because their service/product quality is way better as compared to that of the local companies.
- This practice could also serve foreign firms to dominate the local markets.
What should be done?
Afghanistan’s local firms should cope up with modernization in the field of marketing, because the retrospective infrastructure of Afghanistan serves as the major reason behind the Afghan companies lagging behind. The sports industry, cricket, in particular, is developing fast, therefore it is necessary for the companies to invest in sports so that the local firms can grow in terms of making a profit and intercept the entry of foreign companies into the Afghan market.
*Hamayun Khan is from Afghanistan and currently pursuing last year of an MBA at Punjab Technical University, India.