Panellists at a session entitled 'Financing and Distribution of Specialty Films in India', held in association with Screen International, seemed to agree that major dives in the London and Mumbai stock markets, and the stalling of bank finance and venture capital, could lead to much-needed budgetary correction.
Four speakers - Walkwater Media CEO Manmohan Shetty, Alliance Media's Sunil Doshi, UTV Motion Pictures CEO Siddharth Roy Kapur and filmmaker Anurag Kashyap - agreed that film production companies and corporates would use the recession as an excuse to slide out of projects.
They also predicted that while India's box office will remain strong during a recession, the slowdown will most affect broadcast rights and therefore hit the profit margins for medium and small-budget films in particular. In the past few years, the industry's reliance on theatrical revenues has been reduced as ancillary revenues - from music rights, satellite and home video - can account for as much as 50%.
According to news reports in the Indian media, UTV has recently cancelled several projects in the pre-production stage or green-lit ventures.
Shetty said he hoped that the recession would be short-lived but added that the success of films at the box office 'has nothing to do with the stock market or banks. In this situation, the entertainment industry will continue to do well.'
Roy Kapur added that with 'lots of money chasing limited talent, prices had become unrealistic. The costs had risen so high that even if a film was a success it had become hard to recoup.'
Smaller films finding multiplex success
Over the past few years, India has seen the rise of the small movie, defined as films made on budgets below $1m (Rs50m), which have found a market thanks to the increase in multiplexes throughout India.
Some recent low-budget films to show profitability include Bheja Fry (Handmade Films), A Wednesday (UTV) and Aamir (UTV Spotboy). A big film would have a budget between $4-8m (Rs100-400m).
Kashyap, whose has directed non-mainstream films such as Black Friday and No Smoking, felt the economic slowdown would make filmmaking easier as a larger percentage of the budget would be dedicated to production rather than talent fees.
On the subject of taking specialty Indian films to a global audience, the panel felt that the diaspora audience is keen on star-driven rather than content-driven films. And though specialty films have enjoyed decent film festival participation, it does not necessarily convert to financial success.
Forecasting the course for the Indian film industry, Doshi said: 'We need innovations like direct-to-TV and direct-to-DVD as reaching out to new audiences within India as a theatrical release, with high prices at multiplexes, is going to be a stumbling block for small-budget films.'
India has around 12,000 cinemas of which 750 are multiplexes. Approximately 600 movies are released annually across many languages, including Hollywood films.
Nina Lath Gupta, managing director of the National Film Development Corporation (NFDC), spoke on behalf of the governmental agency which organised Film Bazaar and finances specialty films. 'We are not reliant on the market for funding,' said Gupta. 'Our focus remains small-budget films and to promote the cinemas of India in all languages and with new talent.'
Shetty said he believed that the current situation will not last long and after a much-needed correction, the film industry would financially stabilise once more. However there seems to be a consensus on the need to develop ancillary spaces and new markets, to penetrate deeper into international markets andto realisethe benefits of realistic production costs.
The discussion took place just a few hours before theMumbai terrorist attacks which have shut down the cityand cast a shadow over the second day of the market today (Nov 27).
While project meetings, seminars and a master class with veteran filmmaker Shyam Benegal went ahead as planned, the NFDC and Indian Independent Filmmakers Worldwide (IIFW) both cancelled parties in response to the on-going attacks and hostage situation. Many delegates had flown to Goa through Mumbai and were trying to re-route or delay their return trips today.
In a separate incident, two of the expected delegates - Arclight Films' Gary Hamilton and Easternlight chief Ying Ye - were not able to attend as they have been trapped at Bangkok airport which has been closed by protestors.
In today's seminar, speakers include producers Roman Paul and Sylvain Bursztejn, Lorna Tee of Hong Kong-based Irresistible Films and SPAA executive director Geoff Brown discussed ways in which Indian filmmakers could access international finance and distribution.
Among the topics discussed were the role of sales agents, the advantages and disadvantages of co-productions, soft money, recession and the distribution of Indian films in new territories such as East Asia.