World is not enough for Indian showbiz

CALCUTTA, India, July 4 (UPI) -- In an indication of India's continuing show business successes, global consultancy firm PricewaterhouseCoopers predicts India's film entertainment business will hit $1.12 billion by 2006 -- up from $617 million in 2001.

By the end of 2002, the Indian film business is expected to rake in $703 million, PricewaterhouseCoopers officials said in a recent report. Film entertainment will be the primary driver of entertainment and media sector growth in the country, the report said.

Much of the growth may come from the increasing popularity of Indian films overseas. Indian cinema, with its unique style, is gaining global popularity, said Deepak Kapoor, head of PricewaterhouseCoopers' technology, information communications and entertainment department.

"This is evident from attention two Indian films -- 'Laagan' and 'Devdas' -- attracted at Cannes very recently," Kapoor said. "The market for Indian films abroad is not just limited to the non-resident Indian audience any longer."

Television networks are also expected to contribute to the growth of the entertainment and media sector in a major way.

"A clear regulatory environment will accelerate the growth in all these sectors," Kapoor said.

New regulatory and tax policies may lead to increased investment in local movie productions, helping draw larger audiences, the PricewaterhouseCoopers report said. That would minimize pressure to raise ticket prices, said the report.

Recently announced Reserve Bank of India guidelines allow financial institutions to finance up to $1 million of a picture's budget or up to about 40 percent of the total production cost.

"Bollywood," as the Indian film industry is known, produces the largest number of movies in the world per year -- about 800. But average investment in an Indian movie is a mere $500,000, compared to the average $13 million to $14 million spent in the United States.

Bollywood filmmakers also face a high entertainment tax that leads to under-declaration box-office collection, which in turn severely influences the industry's revenue figures and government collection.

Following the Oscar nomination of "Lagaan," India's movies are gaining broader viewership.

"With Hollywood's acceptance, Bollywood is no more a favorite of just Indians," said Mahavir Barjatya, a movie producer. "It has become part of the world, and the lure of vast overseas markets is encouraging filmmakers to produce slicker movies and explore new vistas overseas."

Industry's marketing strategies have also undergone a vast improvement.

"The Indian film producer has realized that he has a whole new market waiting to be tapped," said Komal Nahata, editor of Film Information. "While Indian films have always done well abroad in the past, that has been primarily due to the NRI (non-resident Indian) audience which provided a ready market."

Earlier, according to Nahata, an average Indian producer spent about a tenth of his total budget on marketing. Now producers spend more to woo Western audiences.

"The sheer riot of colors and the effervescence make an Indian film different from other movies, which often comes as an advantage," Nahata said. "However, it is often also a disadvantage. Western sensibilities are not adapted to our kind of films."