Overview of the VFX Industry

Mr. Shrutidhar Paliwal
Mr. Shrutidhar Paliwal Jan 08 2018 - 3 min read
Overview of the VFX Industry
According to the KPMG India-FICCI Indian Media and Entertainment Industry Report 2017, the Indian animation and VFX industry grew at 16.4 per cent in 2016 to reach a size of INR 59.5 billion.

The animation and Visual Effects (VFX) industry continues to steadily gain acceptance with Indian talent poised to rub shoulders with global counterparts. According to the KPMG India-FICCI Indian Media and Entertainment Industry Report 2017, the Indian animation and VFX industry grew at 16.4 per cent in 2016 to reach a size of INR 59.5 billion, driven majorly by a 31 per cent growth in VFX, with animation remaining steady at a growth rate of 9 percent. 

The VFX industry is a fast emerging and an indispensable part of film making, and the cutting edge work carried out by Indian studios has catapulted the country on to the global VFX scene.  This requires a strong push from the government in the form of incentives, and an evolved mindset and approach of the creators to be a success. However, recently many states likes Maharashtra, Karnataka, Telangana, have announced, or are coming up with, policies in support of the animation and VFX industry. These initiatives would enable the Indian animation and VFX industry to effectively compete with established markets such as the US, Canada and emerging centers like South Korea, France, China and Malaysia.

With this changing mindset of the audience, animation exudes the potential of becoming one of the most sought-after mediums for entertainment and storytelling in India. VFX is making its presence felt in films of all genres be it action, comedy or romance and irrespective of scale, be it small, medium or big budget movies. Bollywood is constrained by the slow pace of screen growth and also has been facing increased competition from Hollywood and regional content. Demand for locally produced animation shows continued to grow in 2017. Broadcasters are now realizing that locally made content, though costlier, has great potential in the long run as seen in successful series of ‘Chhota Bheem’, ‘Motu Patlu’ and few others.

The year 2017 also saw quite a bit of quality outsourcing work done by Indian studios. Considering the incentives provided by the government, the trend of Hollywood and other developed countries outsourcing VFX projects to low-cost ones has been significantly on the rise. This has adversely affected VFX artists in developed countries and to counter this situation, the governments of countries are offering grants, labour tax credits, and subsidies to domestic companies engaged in VFX work to help them retain artists as well as in their expansion efforts.

Although not as popular as the VFX industry internationally, VFX Industry in India is definitely gaining popularity. The movie making value chain has undergone a metamorphosis and it is indeed encouraging to see that mainstream Indian filmmakers plan their production schedules to accommodate the VFX component of the film.

While the industry will get a boost after the release of a few big films in 2018, the television space is also not to be underestimated. The mobile and internet gaming area although still not big enough, should also see accelerated growth in the next couple of years. It is expected that digital will drive growth, and innovation will be the key which will be driven by creative expression. Although nascent, the coming of age of Augmented Reality / Virtual Reality (AR/VR) technologies could be the key trigger for an even better-than-estimated growth of the animation and VFX 2018 industry. 

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