Industry pacts with foreign companies

Ten years ago, India’s animation industry was keen to promote the “Brand India” label, a pitch that suggested the quality of work might be better than foreigners imagined. Nowadays, nearly all the major animation studios in the world have some kind of Indian presence or make use of Indian facilities and personnel.

The last year alone has seen Thomson and DreamWorks invest in Bangalore-based Paprikaas Animation; Disney pact with Bollywood’s top-ranked live-action shingle Yash Raj Films to make three animated films; and UTV commit to build a full-scale animation “pipeline.”

Animation houses have been producing in India for more than 25 years, and South Korea and China were in the subcontracting sector long before Indian companies, so why has the pace of change picked up now?

“Twenty years ago the boom began to happen for the software industry in India; now it’s animation’s turn,” says Taapas Chakravarti, who heads DQ Entertainment, which recently listed on the Alternative Investments Market section of the London Stock Exchange, and also chairs Ficci’s (Federation of Indian Chambers of Commerce and Industry) committee on animation. “The IT industry has brought tremendous organizational and educational skills into this country.”

He also points to young Indians’ growing interest in non-traditional jobs. “We are not shy anymore. Media has opened the eyes and ears of many Indians, and you don’t have to be a civil service clerk to get on in life, you could go to one of those new animation schools.”

“Of course, cost is an advantage, but compared to other competitor countries, China or the Philippines, India has a huge talent pool,” says animation house Toonz prexy Prabhakaran Jayakumar. “Plus we have English-language skills and a huge entertainment market at home.”

Until recently, that home market in India was not a big consumer of Indian animation.

But, powered by a mushrooming TV market, domestic demand for animated content is projected to grow at a compound annual rate of 49% for the next four years, according to a recent Nasscom research report. That means animation production for the local market is going to keep pace with the growing overseas demand for Indian toons.

“How can you tackle the international market if you don’t have strength at home?” asks Chakravarti.

The Ficci has been lobbying the government for help in developing the home market. So far support has been slow in coming.

Animation was not given “industry status” automatically when the rest of the film sector achieved normality in 2000; protective quotas were not forthcoming; and the federal and state governments have been reluctant to fund the establishment of training colleges.

But adversity has strengthened the biz. Just as is happening in the steel and software industries, Indian toon companies are now becoming more aggressive in the global hunt for projects and more predatory at the corporate level. DQ this month bought a 20% stake in theFrench tooner Method Films.

And it is unlikely to be the last investment by an Indian company.

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