Bringing Festival Economics to Dhaka: Cost‑Benefit of Hosting a Large‑Scale Music Event

Bringing Festival Economics to Dhaka: A Data‑Driven Cost–Benefit of Hosting a Coachella‑Scale Music Event

Hook: Content creators, city planners and local businesses in Dhaka face a persistent problem: how to assess whether hosting a large‑scale music festival will boost tourism and jobs without saddling the city with unsustainable infrastructure and security and environmental costs. This analysis gives decision‑makers a practical, numbers‑driven framework for evaluating festival economics in Dhaka in 2026 — with scenario models, policy recommendations and action items you can use today.

Why this matters now

Festival promoters and private investors expanded aggressively in late 2025 and early 2026, moving beyond traditional markets into new cities worldwide. High‑profile investments — including private capital into themed live experience companies — signal growing appetite to stage large events in non‑Western markets. For Dhaka, the question is whether the city can capture the tourism, job creation and tax benefits such events can produce while managing the infrastructure, security and environmental costs they impose.

Executive summary — the bottom line first

Using three realistic scenarios (Medium, Large and Coachella‑scale), this article models likely direct spending, indirect economic impact, jobs created and public costs. It finds:

• Net economic benefit is possible when promoters partner with the city and private sector, and when a large share of attendees are domestic tourists and international visitors with multi‑day stays.
• Upfront infrastructure and security costs can erode short‑term ROI — especially if a new permanent site is developed without a multi‑year event calendar.
• Policy design matters: revenue‑share agreements, phased infrastructure investment and enforceable sustainability and safety requirements increase public benefit and reduce fiscal risk.

Modeling approach and assumptions

This analysis uses scenario modelling rather than single point estimates. That makes the recommendations actionable for planners who need to test sensitivity to attendance, visitor mix, spending and cost structure.

Baseline assumptions (2026)

• Currency: USD used for cross‑comparison; for local planning convert at an assumed rate of 1 USD = 115 BDT (policy teams should update with current rates).
• Economic multiplier for indirect/induced effects: 1.8 (conservative; ranges commonly 1.5–2.5 for tourism events).
• Tax capture: combined municipal and national taxes on services estimated at 10–15% of direct spending (VAT, hotel tax, service charges).
• Security and public service costs: 5–20% of total event operating budget depending on risk profile and public provisioning.

Three scenarios modeled

1. Medium festival: 40,000 total unique attendees over two days.
2. Large festival: 100,000 total unique attendees over two days — regional draw, several headline acts.
3. Coachella‑scale: 250,000 total attendees across multiple weekends (modelled as 125,000/day across two weekends for operational realism).

Visitor composition and spending patterns

Attendee composition drives much of the economic case. For Dhaka, three visitor groups matter:

• Local day attendees — residents of Dhaka who attend and return home the same day.
• Domestic tourists — Bangladesh residents from other cities who travel, stay 1–3 nights and spend on hotels, food and transport.
• International visitors — regional travellers and international tourists who stay multiple nights and generate higher per‑capita spending.

For modelling, assume attendee splits under each scenario as follows (planners should adjust with market research):

• Medium: 75% locals / 20% domestic tourists / 5% international
• Large: 70% locals / 25% domestic / 5% international
• Coachella‑scale: 60% locals / 30% domestic / 10% international

Representative per‑person spending (conservative)

• Local day attendee: USD 20–40 (tickets excluded where ticket revenue flows to promoter).
• Domestic tourist: USD 80–150 per day (includes accommodation, food, transport); average stay 2 nights.
• International visitor: USD 250–450 per day; average stay 3 nights.

Sample calculations — quick view

Below are conservative calculations using middle values from the ranges above. All numbers are illustrative; replace with primary market research for procurement and budgeting.

Medium festival (40,000 attendees)

• Locals (30,000): direct spend = 30,000 × USD 30 = USD 900,000
• Domestic tourists (8,000; 2 nights): direct spend = 8,000 × USD 115 × 2 = USD 1,840,000
• International (2,000; 3 nights): direct spend = 2,000 × USD 350 × 3 = USD 2,100,000
• Total direct spending ≈ USD 4.84M
• Indirect/induced (multiplier 1.8) ≈ USD 8.71M
• Estimated tax capture (12%) ≈ USD 580k
• Temporary jobs (direct, event operations): attendees/50 ≈ 800 jobs (short‑term)

Large festival (100,000 attendees)

• Locals (70,000): 70,000 × USD 30 = USD 2.1M
• Domestic (25,000; 2 nights): 25,000 × USD 115 × 2 = USD 5.75M
• International (5,000; 3 nights): 5,000 × USD 350 × 3 = USD 5.25M
• Total direct spending ≈ USD 13.1M
• Indirect/induced (×1.8) ≈ USD 23.6M
• Tax capture (12%) ≈ USD 1.57M
• Temporary jobs: ≈ 2,000 jobs

Coachella‑scale (250,000 attendees across weekends)

• Locals (150,000): 150,000 × USD 30 = USD 4.5M
• Domestic (75,000; 2 nights): 75,000 × USD 115 × 2 = USD 17.25M
• International (25,000; 3 nights): 25,000 × USD 350 × 3 = USD 26.25M
• Total direct spending ≈ USD 48.0M
• Indirect/induced (×1.8) ≈ USD 86.4M
• Tax capture (12%) ≈ USD 5.76M
• Temporary jobs: ≈ 5,000 jobs

Costs: infrastructure, operations and public services

Benefits look promising at scale, but public and private costs can be material if not structured properly.

Capital and venue costs

Option A: use an existing large open space (temporary infrastructure). Upfront CAPEX minimal (USD 0.5–3M) for staging, power, sanitation and site hardening.

Option B: develop a permanent festival ground outside the city (park, dedicated arena). CAPEX can range from USD 5–50M+ depending on land, utilities and multi‑use facilities. A permanent site makes sense only if the city secures multi‑year events to amortize costs.

Security, policing and emergency services

Security is non‑negotiable in dense urban contexts like Dhaka. Event security budgets typically run 5–15% of total operating costs. For high profile international lineups and crowd sizes above 50,000, expect higher end security spending, plus municipal policing and emergency standby costs which are often not fully reimbursed by promoters unless contractually required.

Transport, traffic and public realm impact

Large festivals create concentrated transport demand. Costs include dedicated shuttle fleets, temporary parking and traffic management. A festival without strong public transport access can impose hidden economic costs via commuter delays and lost productivity; these should be modelled as externalities in cost–benefit analysis.

Waste, sanitation and environmental mitigation

Waste management and post‑event site remediation are often underestimated. Budget 1–3% of direct spending for rigorous waste handling and recycling programs; increase if single‑use plastics and catering are heavy.

Risk factors specific to Dhaka in 2026

• Climate risk: Higher likelihood of heavy rain and heat waves requires weather‑resilient scheduling, drainage and shade/medical facilities.
• Transport capacity: While metro and BRT expansions are ongoing, peak festival flows could overload existing infrastructure without dedicated transit planning.
• Insurance and liability: Global trends show rising premiums for mass events; organisers must secure cancellation and liability coverage which adds to budgets.
• Community impact: Noise, displacement of public open space and vendor access need mitigation — failing which local opposition can derail events. See how community pop‑ups evolved into year‑round micro‑festivals and the mitigation strategies they used.

Return on Investment (ROI) — how to evaluate

ROI must be assessed from three perspectives: promoter (private ROI), city treasury (public ROI) and broader economic impact (jobs, tourism growth). Useful metrics:

• Net fiscal benefit: tax revenues and increased local economic activity minus public service and infrastructure costs.
• Event ROI for promoters: ticketing, sponsorship, F&B and ancillary revenue minus production and security costs.
• Socioeconomic ROI: jobs created, new tourist arrivals, and sustained brand value for Dhaka as a creative city.

Example: a properly contracted Large festival could generate USD 13M in direct spending and USD 23.6M in wider economic impact per event. If the city negotiates a 10–15% take of direct spending via taxes and fees and shares some capital cost with the promoter, the event can be net positive for public finances in the medium term — but only with clear contracts and multi‑year commitments.

Policy recommendations — make it work for Dhaka

To capture benefits while limiting costs, Dhaka needs a pragmatic framework. Recommendations below are actionable and prioritise public value.

1. Start with a pilot, not a permanent build

Run a 1–2 year pilot using existing grounds with temporary hardening. Use pilots to measure real visitor composition, hotel uplift and transit impacts before committing CAPEX for a permanent site.

2. Require a public‑private revenue‑share and minimum local procurement

Contracts should include: municipal fee covering policing and sanitation, a share of on‑site F&B/VAT, and local vendor quotas to maximise local SME benefits.

3. Insist on clear safety and insurance standards

Make full cost recovery for policing/EMS part of promoter agreements. Require event cancellation insurance and weather contingency plans given increasing climate risks.

4. Integrate transport planning up front

Design shuttle networks, park‑and‑ride hubs and coordinate event schedules with metro/BRT operations. Offer incentives for public transit ticket bundling with event tickets.

5. Enforce environmental requirements

Mandate waste reduction plans, water refill stations and a post‑event remediation bond that is refundable upon site clearance.

6. Use data and KPIs

Require promoters to share anonymised ticketing and origin data. Key KPIs: percent of out‑of‑city attendees, average nights stayed, hotel occupancy uplift, incremental tax receipts, and measured traffic diversion impacts.

Practical steps for content creators, influencers and publishers

Local media and creators play a vital role in shaping perceptions and ensuring accountability. Here are practical actions:

• Produce investigative guides that compare promised economic benefits vs. deliverables — request promoter data under Right to Information or contractual transparency policies.
• Create visitor guides and 'how to attend safely' content that improves attendee experience and reduces strain on city services.
• Partner with local hotels, transport providers and F&B vendors to publish verified price guides and packages — this supports small businesses and improves trust.
• Monitor KPIs over multiple years and publish easy‑to‑read dashboards showing tax revenue, hotel occupancy and environmental indicators.

2026 trends organisers and policymakers must consider

• AI and ticketing: Automated anti‑scalping measures and dynamic pricing tools are more prevalent in 2026; these influence who gets tickets and at what price.
• Investor appetite: Late‑2025 and early‑2026 investments into live experience companies indicate promoters will seek new markets — Dhaka should be ready with standardised permitting to attract reputable operators.
• Sustainability expectations: International acts and sponsors expect credible sustainability plans. Failure undermines brand value and sponsorship revenue.
• Insurance pressure: Climate‑related cancellation risk is raising premiums; contingency clauses and municipal support for weather incidents must be negotiated.

“It’s time we all got off our asses, left the house and had fun” — a sentiment echoed by private investors in 2026 as promoters look to expand live experiences globally. For Dhaka, fun must be balanced with foresight.

Case study lessons from other cities

Successful festival cities combine strong promoter relationships with clear municipal contracts. Key practices:

• Multi‑year agreements that amortise infrastructure investment over a portfolio of events.
• Community benefit agreements requiring local hiring and noise mitigation.
• Dedicated transport corridors and night‑time service extensions to move crowds safely — and a proliferation of pop‑ups and micro‑events that complement larger festivals rather than compete with them.

Checklist for Dhaka stakeholders — before you sign the promoter deal

1. Demand a multi‑year business plan with audited projections for attendance and visitor origin.
2. Require an independent economic impact assessment aligned with the city’s tourism strategy.
3. Define the split of CAPEX vs OPEX between promoter and city; avoid full public financing for single‑use infrastructure.
4. Institute enforceable social and environmental obligations with bonded deposits.
5. Set a data‑sharing clause for ticketing and attendance while protecting personal data privacy.

Conclusions — can Dhaka host festivals like Coachella?

Yes — but the economic upside depends on intentional design. At scale, festivals can generate millions in direct spending, thousands of temporary jobs and measurable tourist growth. The catch: without strong contracts, pilot testing and transport and security planning, public costs and community disruption can quickly outweigh benefits.

Bottom line for city leaders: Use pilots, not permanent builds; require promoter cost‑sharing; insist on data transparency and enforceable public interest conditions. For content creators and publishers, the opportunity is to hold stakeholders accountable, produce practical travel and safety information and document outcomes against promises.

Actionable takeaways

• Run a one‑ or two‑year pilot on an existing site with mandated data reporting — measure actual tourist nights, tax receipts and traffic impacts.
• Negotiate a revenue‑share with promoters and require recovery of policing and sanitation costs.
• Use a conservative economic multiplier (1.5–1.8) and test sensitivities for attendance and international visitor share.
• Insist on contingency and insurance clauses to protect the city from weather and other systemic risks.
• Engage local media and creators to co‑produce visitor info and monitor KPIs publicly.

Call to action

If you are a policymaker, promoter, venue operator or content creator in Dhaka: begin with a feasibility workshop this quarter. Demand a transparent, independent economic impact study based on the scenario frameworks in this article. For publishers and creators: track and publish the first pilot’s KPIs — hotel nights, tax revenue and transport impact — and hold parties accountable to the agreed social and environmental standards.

Dhaka can host major festivals — but only if planning is strategic, contracts are fair and the city retains the data and authority to evaluate outcomes. Start the conversation now; the investment decisions you make in 2026 will determine whether large‑scale live music becomes a sustainable engine for Dhaka’s tourism and creative economy.

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