NEW DELHI: The Federation of Indian Chambers of Commerce and Industry wants Doordarshan to launch DD Kids, a channel dedicated to kids’ content in “digital terrestrial” space as it would promote intellectual property creation in India in the field of animation and other content for children.
The wishlist of the Entertainment wing of FICCI submitted to the government covers television and Radio broadcasting, cinema, animation and gaming; apart from suggestions relating to advertising in the media.
FICCI wanted a 10-year Tax Holiday for the animation, special effects (VFX), gaming and comics (AVGC) industry and lifting of service tax on studios developing original content. It wanted restoration of STPI advantage scheme for AVGC or ITES for another 10 to 20 years and cover/encourage exports as well as IP creation.
It wants animation as one of the priority sectors and said the Minimum Alternate Tax (MAT) applicability for units undertaking Animation work in SEZ should be withdrawn to encourage export of animated contents.
Encouragement should be given to entities through reduced tax rates/incentives for exploitation of self-developed content in overseas markets. Exemptions should be granted to overseas payments to foreign artists stationed overseas from withholding taxes. A 50 per cent reimbursable MDA (Market Development Assistance) should be given for travel and registration fees to international market events and withholding tax on revenues accruing from sales of mobile games in non India markets as well as removal of withholding tax on the development contracts given to mobile game developers outside India should be removed. Also, there should be removal of withholding tax paid by expats working in India for Indian mobile game development companies. This was because of long gestation period, potential to generate IPs, and potential to generate future stream of incomes.
The Government should consider setting up of Co-production fund for a minimum of 5 years with Rs 110 crores each year with the Children’s Film Society, India, for AVGC. This will help the industry immensely and in the next 5 years India can boast of over 100 successfully implemented coproductions and shows which will be extremely strong original intellectual property out of India, one of the strongest libraries establishing and restoring forms of art, culture and creative styles and designs which will be known throughout the globe. India would emerge a true leader in the digital content economy and it will ensure jobs for over 400,000 to 500,000 creative, techno creative and artistic youth of the country in the next five to seven years.
The industry body says the excise duty on local manufacture should be brought down from 12.5 per cent to 0 per cent (similar to film and music industry). This will enable CVD to be brought to zero. In addition, the Import duty on consoles (Gaming hardware) should be brought down to 0 per cent. This will increase the installed base of gaming consoles to enable the local developer ecosystem to flourish.
At the outset, FICCI says the Indian media and entertainment industry grew from Rs 821 billion in 2012 to Rs 918 billion in 2013, registering an overall growth of 11.8 per cent. Given the impetus introduced by digitisation, continued growth of regional media, new government formation, strength in the film sector and fast increasing new media businesses, the industry is estimated to achieve a growth rate of 15.3 per cent in 2014 to touch Rs 1059 billion. The sector is projected to grow at a healthy CAGR of 14.2 per cent to reach Rs 1786 billion by 2018.
Television clearly continues to be the dominant segment, but strong growth has been posted by new media sectors, and gaming and digital advertising recorded a strong growth of 25.5 per cent and 38.7 per cent compared to the previous year. The music sector has shown a decreasing growth (-9.9 per cent growth in 2013 over 2012 compared to 18 per cent growth in 2012 over 2011) on the back of strong content and the benefits of digitisation.
Radio is anticipated to see a spurt in growth after the roll-out of Phase III licensing. The benefits of Phase I cable digital access system (DAS) rollout, and continued Phase II rollout are expected to contribute significantly to strong continued growth in the TV sector revenues and its ability to invest in and monetise content.
The sector is expected to grow at a Compounded annual growth rate of 18.1 per cent over the period 2013 to 2018.
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