Trishi Jindal, Legal Associate, Koan Advisory
Concluding the first day of FICCI Frames, Rohit Shetty skilfully wove in insights from his illustrious career with the current needs and challenges of the Indian screen industry.
A prolific filmmaker, known for bringing mega-blockbusters like Singham, Golmaal, and Simmba to Indian audiences, Mr. Shetty has worked in multiple capacities as a stunt double, assistant director, director and producer.
More Screens Would Greatly Stimulte the Film Industry
With the Indian film industry generating box office revenues crossing INR 10,000 crores over the past year, Mr. Shetty was quick to empahisize the continued relevance of the cinematic experience. However, India’s low screen density continues to remain a major challenge inhibiting the growth of the film industry. Mr. Shetty noted that while his latest film release, Simmba, had been hailed as a blockbuster, generating revenues of nearly INR 240 crores; it only attracted around two crore moviegoers to the theatre.
The highest grossing local films generate a maximum footfall of around four crore moviegoers, representing only a small share of India’s potential cinema audience. In stark comparison, China has managed to increase its total number of theatres from 25,000 to 50,000 over the course of just three years. Assessing this reality, Mr. Shetty emphasized the need for more theatres, especially in small towns – where the nearest theatres tend to be two to three-hours away. Potential cinema audiences are instead turning their attention to pirating films via pirate websites on their mobile devices.
While digital consumption has increased the appetite for quality screen content, and provided more legitimate avenues for easy access, piracy continues. The rampant levels of digital piracy are increasingly difficult to prevent. Mr. Shetty acknowledged the strides made in Central Government regulation and policy to combat piracy, such as the proposed amendment to the Cinematograph Act, proposed by the Ministry of Information and Broadcasting to introduce penalties for camcorder piracy has resonated well with the industry. However, while the passing of the anti-camcording law will go some way to preventing piracy at the source, rampant online piracy will continue to be served by the world’s biggest piracy websites housed outside of India. Mr. Shetty emphasised that piracy will have to be tackled by increasing the levels of awareness among consumers and by involving multiple stakeholders. Notably, the Maharashtra State Police has sought to address piracy by co-opting industry members to check the distribution of infringing copies online.
State Laws Inhibit Growth
The Central Government has now initiated several reforms for the film industry, including lower tax rates, and introducing single-window clearances to improve film production. However state-level laws and policies continue to pose challenges on a variety of fronts: States such as Madhya Pradesh, Tamil Nadu and Kerala have announced local body entertainment taxes on cinema tickets over and above the GST, ranging anywhere between 5 and 15 percent. Where theatre owners continue to struggle with high overheads including maintenance, licensing and construction costs; heavy-handed taxation at the local level adds to their financial burden, hindering the development of the theatrical sector. Some industry stalwarts such as Ajay Devgn and John Abraham have ventured into this sector, identifying tier II and III cities in Uttar Pradesh and Northeast regions as for growth. Acknowledging such efforts, Mr. Shetty stressed the need for a collective multi-stakeholder collaborationto drive theatre penetration, along with focused engagement at the state government level.
Global Quality Standards Remain Just out of Reach
The digital-era has heralded vast improvements in visual effects and post production processes. The latest FICCI-EY study released at the 20th edition of Frames, reports that the animation, VFX and post-production sectors grew at around 18 percent in 2018 to reach INR 78.9 billion in terms of revenues and is expected to reach INR 127.6 billion by 2021. Additionally, Indian producers are now motivated to spend nearly 15-20 percent of their productions budgets on VFX, resulting in better visual effects for domestic conten, yet global post-production standards remain just out of reach. Mr. Shetty quipped, “give me 13,000 crores and I’ll give you a Transformer [franchise].”
As it grapples with complex new challenges, the Indian film industry can perhaps take a leaf out of Mr. Shetty’s book. Donning the twin-hats of producer and director, he considers himself foremost an entertainer and emphasises the need to remain honest in both creative vision and conviction.