'Ad expenses to be over .55% of GDP by 2010'

Surge in branding and marketing activities will push advertising expenditures in India to 0.55% of the country's gross domestic product (GDP) by 2010 from the current 0.52%, The Associated Chambers of Commerce and Industry of India (Assocham) said.

A research conducted on the future of advertising in India by the industry body revealed that the ad-spending in the country is continously increasing ever-since the economy had opened up. The sector is growing at a rate of more than 22% per annum.

The sector is expected to cross Rs 16,000 crore in the current fiscal with ample scope for growing further, the chamber said.

Advertising expenditure in developing nations has been growing despite the limited size of the markets in these countries and still has potential, Assocham said.

Developed nations, on the other hand, spend any where between 0.8% to over 1% of their GDP on advertising. The US spends nearly 1.3% of its GDP on advertising, while ad-spend percentage in various parts of Europe and south east Asia is constantly on the increase.