The child, Niya Nizam, had undergone a month's training, a relative of the toddler told television channels.
Niya was looking disturbed and had been crying, spectators said. The girl's mother was seen rushing to pick up her daughter in her arms and comforting her soon after the event.
Kannur Superintendent of Police P N Unniraja told PTI that he had asked the organisers and parents not to put the child to such a trauma.
He said he had told the organisers yesterday not to send the child on the trip and had hesitated to inaugurate the event today.
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The organisers, a private company from Kozhikode, had said legally there was no provision to ban the event, the official said.
Malayalam actor Vineeth, a friend of the family, who was also present, wondered why the media was trying to kick up a controversy when the child's parents had no issues.