Blog Description

Animation Market in India: A Billion Dollar Boom

Animation Market in India

ICT | May, 2024

The animation industry has experienced a significant boom over the past 20 years, driven by a combination of technological advancements, government initiatives, and shifting consumer preferences. In Asia, governments have played a crucial role in nurturing the industry by investing in education and infrastructure, as well as providing financial incentives to attract talent and encourage the development of original content. Taiwan, for example, has over 100 institutions teaching animation, and the government has implemented initiatives to promote the industry, aiming to reach a production value of TWD$370 billion and employ 30,000 people. Similarly, China's animation industry has an annual production value of RMB$2.5 billion and is expected to become a major economic driver, especially in eastern coastal cities like Shanghai.

To add to the context and the already amassed popularity, the COVID-19 pandemic has also contributed to the animation boom, as it has accelerated the shift towards digital content and remote work. This has led to an increase in demand for animation services, with some companies producing up to 200 videos per week. The boom has also been fueled by the growing popularity of animation courses and institutes, such as AnimationBoom in Delhi, which offer training and education in animation.

According to TechSci Research Report “3D Animation Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2018-2028, Segmented By Component (Hardware, Software, Services), By Technology (3D Modeling, Motion Graphics, 3D Rendering, Visual Effects), By End-User (Media and Entertainment, Education, Healthcare, Architecture, Others), By Region, and By Competition” Global 3D Animation Market has valued at USD 21.2 Billion in 2022 and is anticipated to project robust growth in the forecast period with a CAGR of 12.8% through 2028. The Global 3D Animation Market is experiencing substantial growth, driven by the increasing demand for visually captivating and immersive content across various industries.

In addition to that, the rise of streaming services like Netflix, Disney+, and Amazon Prime has been pivotal in this boom. These platforms offer extensive libraries of animated content and provide a global distribution channel, increasing audience exposure to diverse genres, from children's shows to adult animations and anime. This has broadened the appeal and market for animated content.

Continuing in the following blog, will be information about the market size of Animation in India, along with its growth rate and the trends it will be through over the years.

India Animation Market: Size and Growth Rate

The animation industry in India has experienced significant growth over the past few years and has expanded to cater to various sectors such as feature films, television shows, digital effects, video games, and mobile content. India now boasts a large pool of skilled animators, artists, and technicians with expertise in various animation techniques, making it an attractive destination for international clients seeking cost-effective and high-quality animation services. In relevance, the Animation Market size was USD 460.11 million in 2022 and is said to be growing with a CAGR of 37.03%.

The entire “Animation Market” in itself consists of multiple segments that make it responsible for its substantial rise over the years. Each segment caters to different aspect of creation, distribution, and consumption of animated content. They are:

·         Entertainment

·         Advertising

·         Education and Training

·         Medical and Scientific Visualization

·         Visual Effects

·         Virtual Reality (VR) and Augmented Reality (AR)

·         Web and Social Media Content

·         Merchandising, etc.

It is good because having multiple segments within the animation market ensures that the industry can meet a wide range of needs, drive economic growth, foster innovation, and provide valuable content and services across different fields. This segmentation not only enriches the animation industry but also enhances its relevance and impact in various aspects of life and business.

Factors Promoting the Indian Animation Industry

The entire animation and VFX industry in India employs over 40,000 professionals directly, with an additional 60,000 to 70,000 individuals engaged in related fields such as gaming and post-production. Plus, India is home to more than 300 animation, VFX, and post-production studios, ranging from small-scale startups to established production houses. Major cities like Mumbai, Hyderabad, Bengaluru, and Chennai serve as hubs for animation-related activities, hosting a significant concentration of studios and creative talent. Moving forward, let’s have a look at the factors that are making India as an attractive hotspot and destination for international clients seeking high quality animation services.

·        Uninterrupted Technological Landscape

Real-time rendering engines like Unreal Engine and Unity have become popular for their ability to create stunning visuals in real-time, while cloud-based workflows offer scalability and collaboration opportunities for remote teams. Adding up like a cherry on the cake was the COVID19 pandemic. It accelerated the shift towards digital content consumption, leading to increased demand for animation services. Streaming platforms have experienced a surge in viewership, driving the need for fresh and engaging animated content. Likewise, Indian animation studios prioritize investment in cutting-edge technology and software, ensuring alignment with international benchmarks. This dedication to staying abreast of technological advancements not only bolsters the quality but also streamlines the efficiency of animation production processes.

·        Growing Demand For Animation Content

Indian animation studios place significant emphasis on investing in state-of-the-art technology and cutting-edge software, thereby ensuring their competitiveness on a global scale. This steadfast commitment to technological advancements reinforces India's position as a key player in the international animation market. According to recent statistics, the widespread adoption of Over-The-Top (OTT) platforms has surged across all demographics, particularly in children's content, where co-viewership with parents is prevalent. This surge in demand for animation content is further fueled by improved internet speeds and increased mobile internet penetration, providing children with seamless access to content on-the-go. Moreover, the versatility of animation has led to its expansion beyond entertainment into various domains such as education, gaming, advertising, cultural events, and more.

·        Skilled Workforce & Cost Measures

India boasts a substantial reservoir of proficient animators, artists, and technicians adept in a multitude of animation techniques, rendering it an appealing hub for global clientele in search of cost-effective yet superior animation services. Recent statistics indicate that the Indian animation industry is projected to witness significant growth, with a compound annual growth rate (CAGR) of approximately 9% during the forecast period. Furthermore, the Indian animation sector has emerged as a key contributor to the country's economy, with its market size expected to increase profoundly. This remarkable expansion is underpinned by the industry's competitive advantage in terms of production costs, as highlighted by data revealing that animation production in India costs 30-40% less compared to Western countries.

·        Government Initiatives

Notably, government initiatives aimed at attracting foreign direct investment (FDI), establishing new facilities, and fostering employment opportunities in the media and entertainment sector have played a pivotal role in fostering industry expansion. For instance, incentives such as the 40% incentive for foreign film production, coupled with an increased cap limit to Rs 30 crore, have been announced, signaling the government's commitment to bolstering the animation and filmmaking ecosystem. These initiatives not only stimulate economic growth but also enhance the global competitiveness of the Indian animation industry, positioning it as a formidable player on the world stage. As a result, the animation sector continues to thrive, driving innovation, creativity, and employment generation across the country.

With over 40,000 professionals directly employed and a thriving ecosystem of studios, India emerges as a global hub for animation services. The adoption of real-time rendering engines and cloud-based workflows, coupled with increased demand for digital content, further propels the industry's growth trajectory. Government incentives and a competitive production cost advantage add to India's allure for international clients.

A Discussion on Specific Technological Advancements: Rise in Available Products

While the above aspect discusses about the driving factors, specific technological advancements are a must to discuss. For example, The widespread adoption of powerful digital animation software, such as Adobe Creative Cloud, Autodesk Maya, and Toon Boom Harmony, has revolutionized the industry by allowing animators to create high-quality 2D and 3D animations with greater efficiency, precision, and creative control.

Likewise, the introduction of Advanced Motion Capture (mocap) technology has enabled Indian animation studios to bring their characters to life with more natural and realistic movements. Mocap systems, like those from Vicon and OptiTrack, facilitate the seamless integration of real-time human movements into digital animations. Additionally, improvements in rendering engines, including Arnold, Redshift, and V-Ray, have significantly enhanced the visual quality of Indian animations, allowing for the creation of stunning photorealistic environments, lighting, and special effects. Advancements in compositing software, such as Adobe After Effects and Nuke, have further streamlined the process of integrating various elements into a cohesive animated scene.

The rise of cloud-based collaboration tools, including Google Drive, Dropbox, and Microsoft SharePoint, has enabled Indian animation teams to work together more efficiently, even when team members are geographically dispersed. These platforms facilitate real-time file sharing, version control, and seamless communication, streamlining the animation production process. Furthermore, the availability of powerful graphics processing units (GPUs) from companies like NVIDIA and AMD has dramatically improved the rendering capabilities of Indian animation studios, allowing for the creation of more detailed and visually stunning animations.

Some Notable Examples of Animation Projects in India: Among the Top 5

India has produced several notable animation projects over the years, showcasing the country's talent and creativity in this field. Here are some of the most notable Indian animation projects:

1.   Roadside Romeo

Co-produced by Yash Raj Films and Walt Disney Pictures, "Roadside Romeo" is a 3D animated film featuring anthropomorphic animals. Directed by Jugal Hansraj and co-directed by Krishna DK and Raj Nidimoru, the film marked Disney's foray into Indian animation and was well-received for its humor and animation quality. "Roadside Romeo" was a significant milestone for the Indian animation industry, as it demonstrated the potential for high-quality, commercially successful animated films that could appeal to both Indian and international audiences. The film's success also paved the way for more collaborative projects between Indian and international animation studios.

2.   Motu Patlu (2011-Present)

Created by Niraj Vikram, this long-running and beloved animated series follows the comical misadventures of two quirky and lovable friends, Motu and Patlu, as they navigate the lively and vibrant town of Furfuri Nagar. Beyond its comedic appeal, Motu Patlu has also been lauded for its ability to convey valuable life lessons and moral messages, often subtly woven into the narrative. The series' enduring popularity and the strong connection it has forged with its young audience have solidified its status as a beloved and iconic Indian animated series, one that continues to delight and entertain viewers of all ages.

3.   Arjun: The Warrior Prince (2012)

This beautifully crafted 3D animated film, Arjun: The Warrior Prince, is a captivating adaptation of the life and exploits of the legendary Pandava prince, Arjun, from the epic Indian saga of the Mahabharata. Directed by the talented Arnab Chaudhuri, this cinematic endeavor was a collaborative effort between UTV Motion Pictures and the renowned Walt Disney Pictures. Arjun: The Warrior Prince has received critical acclaim for its exceptional storytelling, which delves deep into the complex emotional and philosophical underpinnings of the Mahabharata narrative.

4.   Chhota Bheem (2008-present)

Masterminded by the creative genius of Rajiv Chilaka, this iconic series has not only enchanted children but has also earned a devoted following among viewers of all ages, cementing its status as a beloved and iconic staple of Indian animation. The series' exceptional storytelling, which skillfully blends elements of humor, problem-solving, and heartwarming moments, has resonated with audiences across generations, making Chhota Bheem a true cultural phenomenon.

5.   Hanuman (2005):

This groundbreaking animated feature not only enchanted audiences but also played a pivotal role in elevating the stature and popularity of the animation industry in India. Hanuman's profound influence on the Indian animation industry cannot be overstated. The film's success not only inspired a new generation of animators and storytellers but also paved the way for more ambitious and culturally significant animated projects to emerge, further elevating the status of this dynamic and evolving art form in the country.

India Animation Market: Government and Policy Support

Due to the advancements in computer’s computing capabilities, the animation and graphics’ scenario has today taken a significant step. With steep innovations and graphic development with the help of real-time motion engines, the need to have a proper policy has become a must. It is because government policies can provide financial incentives, tax breaks, grants, and subsidies to encourage both domestic and foreign investment in the animation industry. In addition, government support is essential for the development of infrastructure such as animation studios, post-production facilities, and research centers. By investing in state-of-the-art infrastructure, policymakers create an enabling environment for animation production, attracting both domestic and foreign players and enhancing the industry's competitiveness on a global scale.

·        National Film Policy (2022)

The Indian government's National Film Policy 2022 includes provisions to promote the Animation, Visual Effects, Gaming, and Comics (AVGC) sector. This comprehensive policy framework aims to bolster the AVGC industry by setting up an AVGC Promotion Task Force, facilitating collaboration between stakeholders, and providing financial incentives for AVGC projects.

·        Production Linked Incentive (PLI) Scheme

The Indian government has launched the PLI Scheme for the AVGC sector, providing financial incentives to domestic companies for the production of animation, visual effects, gaming, and comics content.

·        AVGC Promotion Task Force:

The Indian government has set up an AVGC Promotion Task Force to formulate policies, strategies, and action plans to develop the AVGC sector in the country. This includes recommendations for skilling, infrastructure, and export promotion.

·        Skill Development Initiatives:

The government has launched various skill development programs and courses to enhance the talent pool for the animation and VFX industries, such as the Skill India initiative and the Animation, Visual Effects, Gaming and Comics (AVGC) Promotion Task Force recommendations.

·        Infrastructure Development:

The government has launched various skill development programs and courses to enhance the talent pool for the animation and VFX industries, such as the Skill India initiative and the Animation, Visual Effects, Gaming and Comics (AVGC) Promotion Task Force recommendations.

·        Export Promotion:

The government has initiated various export promotion schemes and initiatives to support the global reach of Indian animation and VFX studios, such as participation in international film festivals and trade shows. Additionally, the establishment of animation hubs and incubation centers aims to enhance the global competitiveness of Indian studios, fostering innovation and attracting foreign investments.

These government policies and regulations have played a crucial role in fostering the growth and development of the animation and VFX sectors in India, helping to attract investment, develop talent, and promote the global competitiveness of the Indian animation industry.

How Is The International Market In Comparison To Indian Animation Market: The “Vs” Scenario

Everyday is an advancement day for the animation industry. With free hand and softwares’ easy availability, 2024 is poised to introduce trends and methods that redefine artistic expressions and how audiences interact with media through the talent of the animators. International studios, especially those in Hollywood, are known for their high production values, cutting-edge technology, and creative storytelling.

In terms of “Technological Advancements”, major animation hubs like the United States, Canada, Japan, and Europe have access to the latest animation software, hardware, and rendering technologies, allowing them to produce high-quality, cutting-edge animated content. In this regard, India has been working to catch up in terms of technological capabilities, but still faces some challenges in terms of infrastructure and access to the latest tools and software. With respect to “Financing and Production Budgets”, Larger animation markets like the US and Japan have access to significant financing and production budgets, allowing for the creation of high-budget, feature-length animated films and TV series. On the other hand, the Indian animation industry, while growing, often faces challenges in securing the necessary funding for large-scale, high-budget productions, limiting their ability to compete with international counterparts.

In spite of the number of innovative edges the international market has over the Indian Animation market, the Indian animation market has several strengths and advantages that, in some ways, make it better or more competitive than the international animation market.

The Indian animation industry benefits from lower production costs, including labor and operational expenses, compared to many developed animation hubs like the US, Canada, and Europe. This cost advantage allows Indian studios to provide highly competitive pricing for animation projects, making them an attractive outsourcing destination for international clients. In addition, a unique cultural perspective and ability to create narratives that resonate with both domestic and international audiences can be a key differentiator for the Indian animation market. The Indian animation industry is often characterized by its ability to quickly adapt to changing market trends and technological advancements, allowing it to be more responsive to shifting consumer preferences. This agility can give Indian animation studios an edge in quickly developing and delivering innovative, market-relevant content.

Examples of Indian Animation Studios Successfully Adapting To Changing Market Trends

Ø  Toonz Animation India:

Established in 1999, it is one of the pioneers of the Indian Animation industry. The company has successfully transitioned from traditional 2D animations to 3D animations, CGI, and even virtual reality-based projects. Production names include some notably popular ones like “The Adventures of Tenali Raman”, “Motu Patlu”,”The Adventures of Hanuman”, etc.

Ø  Assemblage Entertainment:

This animation studio, established in 2013, has quickly gained prominence due to its diversification into areas like virtual production, virtual reality experiences to stay ahead of the curve. With secured partnerships with global media giants, the company produces high quality animated content like “Super Giant Robot Brothers (2022)”, “Arctic Dogs (2019)”, “Norm of The North (2016), etc.

Ø  Green Gold Animation

Green Gold Animation was established in 2001 and is popularly known for its flagship show “Chhota Bheem” which is known for being one of the most popular children’s series in India. Other offerings from the production house include “Mighty Raju”, “Krishna Balram”, etc.

According to TechSci Research Report “Virtual Production Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2018-2028, Segmented By Technology (Real-time Visualization, Motion Capture, Virtual Camera, VR/AR, 3D Modeling and Animation), By Component (Hardware, Software and Services), By End-User Industry (Film and Television, military & intelligence, Gaming, Advertising, Education and Training, Others), By Region, and By Competition” The Global Virtual Production Market is experiencing substantial growth and is projected to continue expanding at a robust pace in the forecast period. With a Compound Annual Growth Rate (CAGR) of 18.3% through 2028, the market's value is expected to increase significantly from its estimated worth of USD 1.75 billion in 2022.

New Audience Segment: Current Trend of Animation Industry In India

The Indian animation market has seen the emergence of several new audience segments in recent years, which studios have had to adapt to. This diversification and volatility in the audience’s viewership taste has helped industry experts to gain some relevant insights about the overall market.

·         Local Content’s Demand Is On A Record Rise -  Indian audiences, especially children, have shown a strong preference for animation content with local cultural references and narratives. Studios have responded by developing more original Indian IP and stories that resonate with the local audience. This not only has helped animation studios build a stronger emotional connect with the viewers, but also establish loyal fan bases.

·         Rise of Younger Audiences - There has been an observable rise in the number of children and young adults consuming animated content. Animation studios in India have focused on creating more age-appropriate and engaging animated shows to cater to this growing demographic. They have been successful at creating a stronger emotional connect with the audience through their targeted productions.

·         Growing Adult Audience - There is an increasing demand for more mature, complex, and diverse animated content targeted at adult audiences. Studios have begun to experiment with darker themes, mature storylines, and animation styles that appeal to older viewers. This has opened up new opportunities for studios to explore different genres and narratives beyond the traditional family-friendly animation.

·         Growing Female Viewership – Animation studios are now recognizing the need to create content that caters/appeal to female audiences, both young and adult. This steep rise in female viewership belongs to factors like ‘demand for strong female protagonists’, ‘rising educational and economic status of women in India’, etc. Also, more studies are developing productions with empowered characters and themes around gender equality, education, and social impact.

Analyzing The Rise Of Original Animated Series and Films: AND THE STORIES THEY TELL

India's animation industry has undergone a remarkable transformation in recent years, with the emergence of captivating original content that is captivating audiences both within the country and across the world. These animated series and films are not just entertaining but are also weaving narratives that are deeply rooted in India's rich cultural heritage, while also addressing pressing social issues. Gone are the days when Indian animation was primarily confined to adapting Western cartoons or producing generic family-friendly content. Today, studios are laser-focused on creating stories that truly reflect the diversity and uniqueness of India. Animated series like "Chhota Bheem," "Motu Patlu," and "Krishna Balaram" draw inspiration from classic Indian folklore, mythology, and cultural touchstones, resonating with the domestic audience in a way that was previously unheard of.

The power of animation to inspire change and shape social consciousness is becoming increasingly evident in India. Animated films like "Bombay Rose" and "Kadak" have tackled complex issues such as gender inequality, class divides, and urban challenges, using the medium to shed light on these crucial societal concerns. Also, India's linguistic diversity is being celebrated through the rise of regionally focused animated content. From the Tamil series "Sakthi" to the Malayalam series "Jyo and Jaya" and the Marathi series "Aisha and Kabir," these animations are not only entertaining their local audiences but also helping to amplify unique cultural nuances that were previously overlooked.

In India, the audience have become more discerning and expectant of high production values in animated content, driven by their exposure to global animation standards and the proliferation of digital platforms. Consumers now appreciate the technical prowess and visual sophistication exhibited in the latest Indian animated series and films, which leverage advancements in 3D animation, motion capture, and visual effects. This shift has pushed Indian animation studios to elevate their creative and technical capabilities, catering to the evolving preferences of the audience.

Summing Up

The transformation in Indian consumer behavior and preferences towards animation has been a catalyst for the industry's remarkable growth and diversification. Audiences, especially the younger generation, have demonstrated a strong affinity for localized content that celebrates the country's rich cultural heritage and regional narratives. This shift has empowered Indian animation studios to create captivating series and films that resonate deeply with the domestic market, moving away from the historical dominance of Western-centric animation. Concurrently, there has been a growing demand for animated content that tackles complex social issues, promotes inclusivity, and shapes positive societal values - a testament to the evolving sophistication and social consciousness of the Indian viewer. The widespread adoption of digital platforms has further transformed consumption patterns, enabling audiences to access a wider range of animated offerings tailored for the online ecosystem. Additionally, the rising popularity of "edutainment" has highlighted the industry's ability to leverage the power of animation to educate and inspire the next generation. As Indian animation continues to scale new heights, the industry's ability to adapt to these evolving consumer preferences will be crucial in solidifying its position as a global creative powerhouse and a reflection of the country's vibrant cultural identity.

The future of Indian animation looks promising with several key factors driving its growth. Firstly, the government's supportive policies and initiatives have created a favorable environment for the industry to thrive. Secondly, the burgeoning pool of skilled animators and technicians, coupled with world-class infrastructure, is setting new standards in animation production. Hence, in summary, the Indian animation industry is at a pivotal moment, characterized by rapid growth, technological innovation, and a deeper connection with cultural roots. By continuing to embrace change and addressing the dynamic needs of its audience, the industry is well-positioned to become a significant player on the global stage.

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