Can the Budget 2022 Save the Sinking Ships of Bollywood Post Covid?

The Indian film industry is the world’s largest film industry in terms of volume, but since the lockdown of March 2020, it is facing a constant downfall. The global shutdown impacted major film production as the shoots were indefinitely postponed, with thousands of cinemas shutting down.

Last year, the Union Budget 2021 came up with some customs duty rate changes, which temporarily exempted filmmakers from importing costumes and props. However, this time, experts are speculating the government will provide more substantial relief to the industry as it has battled huge economic losses in the last two years.

“Pandemic had affected one and all. Being a regional content creator, we expect the Government to exempt basic GST for a certain period or refund GST credit as a huge part of the budget is already blocked in the last two years due to the non-release of films,” said Akshay Bardapurkar, founder, Planet Marathi.

Support for regional brands and MSME of the entertainment industry should also be provided. It’s high time we realize the potential of this sector that generates huge revenue and the percentage of employment it creates in the region, he added.

Bollywood’s profits stands at a little over Rs 30 billion, but the constant lockdowns have halted the film production taking a heavy toll on the industry. The Indian cinema industry has lost theatrical revenues of nearly Rs 120 million in the last two years. Slashing taxes on cinema halls for at least 6 months would provide a major push to the box-office revenues.

The lockdown also has an additional impact on revenues in term of lost concession sales, screen advertising sales, etc. Typically, a film set employees anywhere between 300 and 500 people including crew, main cast, junior artists and stuntmen. The halt in production has left them jobless.

Despite providing high employment directly and indirectly, the cinema industry has never gained a significant priority of the government. The last two years have been a nightmare for a thriving industry like Bollywood, leading to tremendous losses. The relaxation in GST taxes till the losses are recovered or the industry stabilizes could be one way to bring the industry back on track.