Mumbai: The animation industry in India is estimated to be at $460 million in 2008 and set to grow at a CAGR of 27 per cent to reach $1,163 million by 2012 as per a report by NASSCOM. The report was unveiled at the annual NASSCOM Animation and Gaming India 2008 in Hyderabad.
The two-day event has been structured to chart out the vision, set aspirations and identify strategic imperatives to address global opportunities for these sectors in India.
NASSCOM chairman Dr. Ganesh Natarajan and global CEO Zensar said, "We realize that it is critical to nurture the animation and gaming industry to ensure further growth. The fiercely competitive global market place calls for disciplined effort as well as policy measures in this direction. Providing tax breaks and holidays to animation and gaming development studios, setting up education centers, cutting import duty for gaming consoles as well as equipment or software required for game production and setting up special zones to create an entire ecosystem will go a long way in accelerating industry growth."
NASSCOM president Som Mittal added, "The world is looking towards India as a gaming and animation hub and we believe that India is well placed to leverage this opportunity. Indian gaming and animation industry has outpaced the growth rates of its counterparts and the last few years have seen the industry evolve and mature to deliver high international standard projects. Some of the inherent factors that have contributed to India’s rise in the animation and gaming space are availability of the right skill sets, growing maturity of animation studios, increase in number of co-production ventures, development of intellectual property, growing consumer demand from the domestic market and of course, cost attractiveness."
As per the report by NASSCOM and Ernst & Young, the market has been defined as animation entertainment ($120 million), animation education ($53 million) and custom content development ($187 million) and multimedia/web design ($ 100million). The education segment is projected to have the maximum growth rate at about 40 per cent per annum. By the end of 2008, the gaming industry in India is expected to value at $ 212 million expected to reach $1060 million by 2012 at a CAGR of 50 per cent.
Ernst & Young national sector leader media and entertainment practice Farokh Balsara said, "With all the groundwork already in place, the domestic animation and gaming industry is on the threshold of growth. With improved skill sets and the ability to develop and produce high quality work, the industry has moved up the value chain." He further added, "With change in the intellectual property ownership, the rights of animation will be retained by the developers which will enable them to exploit alternate revenue streams such as merchandising and sale on digital platforms."
Ernst & Young partner media & entertainment practice Ashok Rajgopal added, "There is an increasing need to broad base the Indian value proposition beyond the cost arbitrage to include quality production value, high skill sets, better project management, and timely deliverables. There is a need to aggressively pursue the skills agenda. Besides, relaxation of import duties on key hardware and tax rebates can unshackle the industry propelling it into a high growth trajectory."