Animation industry is waiting for the 'Policy' to trigger boom

With a 26 per cent compounding growth from 2006 to 2010 and a US$600 million revenue, the Animation, VFX Gaming and Comics (AVGC) community in the state considers itself a fledgling industry – how the IT industry itself was nearly 15 years ago.

With the promise of a boom, confirmed by the setting up of shop by Hollywood biggies such as Dream Works, the industry feels a policy would further consolidate the business environment, not to mention the official anointment that AVGS would be viewed as an industry in the making.

Speaking to Deccan Herald ABAI (Association of Bangalore Animation Industry) President Balakrishna Maddur said “This is certainly a different segment with a unique set of requirements. AVGC is powered by creative professionals who find IT as an enablement.
The emphasis is more on the creative output with entertainment as the objective. So, only a separate policy can address the needs of this industry.”

However, despite the industry lobbying hard on its unique requirements and the government’s eventual understanding of its revenue generation potentials, there could be doubts as to how the industry could be treated the same way as IT nearly 15 years ago. By ABAI’s own admission, the government has taken more time to evolve the policy and surely, more thoughts would have been given to the industry’s wish that it should be viewed as the next IT industry, which could be another way of saying it should be given the same kind of incentives as IT. Animation bigwigs are now looking for a massive boost to tap the global Rs 646 billion industry.

“The AVGC has started to evolve later than the IT and therefore could not fully utilise the tax holidays the IT sector had enjoyed. Moreover, the high-end technology in use has been constantly changing which studios have to keep up with. Also, time horizon to monetise on investment is short,” Balakrishna said.

The fact that AVGC, unlike IT, caters to entertainment industry that has a steady demand-supply and constant revenues, would mean that it cannot be treated on par with the IT industry that caters to a sectors that go through the ebbs and flows of the economy. But, this hardly discourages that industry from expecting more.

“We would like to see (in any policy) exemption of entertainment taxes and want the government to sign co-production treaty with major animation countries like Canada, UK, US, France etc,” said Reliance Animation CEO Ashish Kulkarni, regarded an industry veteran.

“Animation should also be part of the school and college curriculum so that we have more quality professionals working in the industry. Arts schools in the state should also get upgradation,” Ashish adds.

Such measures would help standardise jobs and improve skills available in the country and may also increase the wage cost. So, it is yet unsure if the government is getting into a deal which may create more than a hand-holding situation for itself. “It’s good that the government has finally got the policy ready,” Balakrishna said. “But we do hope that it fulfils industry’s expectations and needs.”

As per the government sources the animation policy is before the cabinet and awaiting for approval. No one is sure that they could be reasonable at this stage.