Water, water everywhere, not a drop to drink…" While this may be stretching things too far in the context of the Indian animation sector, the fact remains that not much has happened on this front in the 69 years that followed the release of the first animated film in India.

For the record, The Pea Brothers (released in 1934) is considered the first animation film to be released in the country, whereas ‘Father of Indian cinema’ DG Phalke is credited with producing the first Indian animated shots during World War I, when he could not obtain adequate film supplies to do live action features. What’s more, the renowned animator and the present president of UTV Toons, Ram Mohan, provided footage for Mrinal Sen’s film Bhuvan Shome as early as 1969. It was the first Indian feature film which had animated footage as an integral part of the story. In 1977, Mohan also did animation for some scenes in Shatranj Ke Khiladi, a much-acclaimed film by Satyajit Ray.

So what went wrong on the animation front in India, which has traditionally been a creative country as far as story telling, is concerned—be it art, dance, painting or temple sculpture? Not to forget that India’s entertainment industry, led by the film and TV sectors, is estimated to touch $58.3 billion by 2005, up from the existing $19.6 billion. Compare this with the $1.5-billion forecast by Nasscom for the animation sector in 2005, and we realize that despite being the most-favored ITeS destination for the world, the country has failed to bag substantial animation orders. And while the whole country seems to be going gung-ho about the growth prospects of the sector, in real terms it stands at just 2.6% of the overall Indian entertainment industry projection for 2005. The silver lining, however, is that if India manages to achieve the forecast figure, it would be a 40% growth in animation production over 2001 figures of $0.6 billion.

Is that reason enough to cheer? Certainly it is, considering that despite some early attempts, the Indian animation industry has been slow to take off on the digital platform falling behind other Asian countries like South Korea, Philippines, Taiwan and China. In fact, activity on this front only began in earnest, in the late 1990s after the slew of Hollywood movies complete with special effects and animation caught the fancy of the nation. It was time for the country’s entertainment industry to take a closer look at the kind of work being done by the West and probe the possibilities of using similar effects; the demand was surely the driving factor. Soon animation studios began to make their appearance in the country and the industry also started developing a more serious, export-oriented outlook.

India: The new destination?
While the demand for special effects was always there from the advertising sector, the growing interest of the entertainment segment coupled with the emergence of India as an IT hub triggered off the essential automation in the animation sector.

According to producer-director Mahesh Bhatt, "It took us (Indian filmmakers) ages to realize we could indigenously achieve the same visual effects that the West was able to achieve; it was an inferiority complex that India suffered from. But no sooner did the IT boom happen and our kids went to Silicon Valley and stood shoulder-to-shoulder with the techies there, the confidence began to seep in."

Today, Indian animation studios, which were earlier focusing on minor projects like multimedia presentations, CD-ROM applications, and computer-based training (CBT) modules are eyeing larger and more lucrative projects—from television mini-series’ to movies and co-production of full length animation movies. The good news is that Indian companies have been able to bag orders from America, Canada, and Europe—the three biggest markets outsourcing digital content jobs to Asia.

No wonder, the business mood in this IT-enabled service sector is upbeat with the apex body for software and services in India, Nasscom and chambers of commerce like CII and Ficci actively promoting this sector. According to an independent trade survey conducted recently, the Indian animation industry is expected to grow at 30% annually in the next couple of years and reach a level of $15 billion by 2010.

Will India be able to replicate its success in the other ITeS sectors and beat the Koreans, the Taiwanese, the Filipinos, and the Chinese in their game? Or rather, are there issues that can hold back the country from cashing in on the opportunity they have woken up to rather late in the day? According to experts, its important to understand how other countries made big in this sector and the challenges that India needs to tackle if it intends to steal the show from the "incumbents".

Learning from the leaders
According to John A Lent, a pioneer in the study of international communications and Third World mass media and author of Animation in Asia and the Pacific, "while animation in Asia was influenced to a great extent by the West, resulting from initial exposure to foreign cartoons and then training abroad or onsite, key animators in countries like China, Taiwan and Thailand started experimenting with local themes and characters soon." On the other hand, in the words of Giannalberto Bendazzi, the author of Cartoons: one hundred years of cinema animation, "Indian animation always betrayed the ethnic heritage of local animators and almost always borrowed from Western productions."

This adversely affected the growth of the domestic market creating a chicken and egg story similar to the hardware sector.

The lack of demand also led to the lack of awareness within the entertainment sector fraternity about the potential of animation, especially using the digital platform. Explains Maya Entertainment’s chief animator, Shibu Menon, "There is a vast difference in the working culture in the West and that of India. While Hollywood considers animation an integral part of the film and has a separate budget for it, producers and directors in India look for special effect or animation only when they are unable to shoot in real. There is a need for a change in our mindset."

Remember your roots: While foreign work were always imitated in China, the Chinese—perhaps more than any other Asian animators, except Japan—were insistent on adapting only those elements of foreign animation that fit their culture. As early as 1936, an article published in a periodical brought out by a studio, Mingxing Company, strongly advocated this idea. "In a Chinese film, one ought to have a story based purely on real Chinese traditions and stories, consistent with our sensibility and sense of humor... Also, our films must not only bring pleasure, but also be educational," the article said.

A short time later, China produced its first feature-length animation, Princess with the iron fan, and although the Disney influence was still discernible, it did not have the usual heavy dosage of sweetness and prettiness. Further, the story evolved from the Chinese novel, Journey to the West. The Chinese added more local stories to their animation repertoire after Mao ascended to full power in 1949. The following year, 1950s, is considered to be China’s golden age of animation complete with indigenous styles and techniques.

Similarly, the amount of domestic animation produced by Vietnam’s Hanoi Cartoon Studio (HCS) was formidable—five to ten titles annually since 1961 or a total of 260 by 1998. The quality of the artwork, according to Lent was superb, "for Vietnam is a country with a long tradition of drawing and painting, reinforced by the French colonizers who encouraged the formation of art schools." Beginning in 1991, Vietnam became a haven for overseas animation studios—first the Japanese, followed by the French company Pixibox in 1994 and then the American, Korean, Filipino, German and Australian companies that swarmed the country since the mid-1990s. In 1997-98, Australia’s Énergee Entertainment struck a deal making HCS its overseas facility. Énergee also granted HCS distribution rights to its full catalogue of animation. Today, creative aspects of animation, such as compositing, modeling, and rendering of images, that used to be done with high levels of skill in Vietnam, are retained in Paris, San Francisco or Sydney. Also, Vietnamese artists are regularly sent to Australia for training or are imbued with the ‘European philosophy’ every three to four months by visiting experts from Pixibox.

Another interesting case study is that of Thailand’s first animator Payut Ngaokrachang. When the US Embassy in Bangkok was scouting for animation artists for its anti-communism campaign, what caught their attention was Ngaokrachang’s drawing with a local theme—a Thai child sitting in the palm of a hairy hand carrying a sickle. He was soon signed for a contract in 1955. During his stint with the United States Information Service, he produced Hanuman Pachoenpai Krangmai (The new adventures of Hanuman, 1958) and Dek Kub Mee (A child and a bear, 1960). Like the Wan brothers, credited with pioneering animation in China, Payut was definitely influenced by American cartoonist Max Fleischers but he also integrated techniques from local shadow theatre nan talung.

Agrees net Guru India’s assistant manager for digital media Sunando Banerjee: "Indian animation industry always depended on the content from abroad, specially the West to meet the domestic market needs unmindful of the fact that there are stories and characters from history and mythology that are really great in India." While Banerjee feels that there is a definite need for a change in the mindset, according to him this requires a proactive approach from the government. "Animation is no doubt a costly affair but the government should realize that the medium has the potential of becoming a major source of revenue generation for the country. It is important that the government comes out with funds to encourage animation companies to work on the Indian classics rather than solely depending on the content outsourced from abroad," Banerjee adds.

Government support holds the key: While the focus on local content and integration of indigenous techniques gave these countries adequate tools to create the best breed animation, it also bolstered the confidence of the companies willing to outsource work. However, another big factor that helped these countries emerge as strong animation players has been the support from their respective governments.

The South Korean government, for instance, went full steam ahead to establish a local animation industry during mid-1990s.

In 1994, the country’s government recognized animation as a ‘value-added’ product and granted the industry a number of incentives—lower tax base, low-interest loans, and a viable infrastructure. Studios producing primarily foreign work increasingly turned domestic, bringing out about half-dozen features and numerous shorts and episodes depicting Korean folklore, humor, and culture. Even though the experiment was short lived it made South Korea world’s third largest producer of animation work. No doubt, 95% of its present animation output is still exports, the government support nevertheless created a strong network of 400 animation studios! Compare this with the around 60-75 studios in India.

China, on the other hand, has a different story to tell. The Shanghai Animation Film Studio, which for decades produced only Chinese animation, started to pick up foreign work by the early 1990s, especially after it became Shanghai Yilimei Animation Company, a joint venture with Yick Lee Development Company of Hong Kong.

According to Head of Tata Elxsi Mediaworks K Chandrashekhar, "While established production pipelines definitely help Korea and China bag a majority of the animation outsourcing contracts the tremendous support from their governments towards funding the studios has also enabled studios in these countries to compete on price terms."

There is another angle to the story from these lead players in animation sector. While automation through IT happened at a much later stage, these countries not only mastered the art of animation as per the Western world standards, they also managed to integrate it with the locally available skill set by that time the concept of outsourcing really started picking up. This came quite handy in terms of the required manpower strength to meet the constantly increasing volume of outsourced work.

The Indian scenario
It is important to understand the kind of work being done by Indian animation companies before one can actually attempt to answer this question. It is also not out of place to talk about where the country stands today vis-à-vis other Asian countries. JadooWorks’ Business Development Manager for APAC Raj Gopal Iyer sums it in a sentence: "Indian animation industry is today at a stage where the software industry was 10-15 years ago." Others in the industry are, however, more upbeat.

According to Nasscom’s Strategic Review 2003 the animation market in India today is characterized by the presence of multiple players including Crest Communications, Films Division Maya Entertainment, Silvertoon Studio, 2NZ Studio, Cine Magin, Climb Film, UTV Toons, Zee Institute of Creative Arts (ZICA), Digital Studio, Pentamedia Graphics, Prasad Studios, Acropetal, JadooWorks, Color Chips, Heart Animation, Ocean Park, Padmalaya Telefilms, and Toonz Animation, Magic Shop, Moving Pictures, among others. These companies are spread across cities such as Mumbai, Chennai, Bangalore, Hyderabad and Thiruvananthapuram.

However, not everybody in the industry is talking about the opportunity or the work being done for the local market. In fact most of the people that Dataquest
spoke to talked about the lack of it. According to Mediaworks’ Chandrashekhar, "Due to the limited exploitation of the true potential of animation in India, some Indian studios have begun to address the international market for 2D and for 3D animation." Majority of the industry veterans also raised the issue of the RoI on the huge investment required for creating complete animation content for the domestic market. "Not many people can dare to invest in animation projects as there is no guarantee of the targeted audience and returns as well," says Menon. So where does India go from here?

A thorny road…
Poor availability of resources and skill sets, lack of adequate finance and recognition of the sector as a significant business for investment, cost constraints, high acquisition cost expensive of equipment and software… and the list goes on. According to the vice-president of international business development at Crest Communications AK Madhavan, while the Union Budget 2003 has bought in some ray of hope by announcing cuts in custom duty for end-user systems it’s high time the government also looked into other issues and started actively supporting the sector. Agrees Iyer: "While the industry bodies like CII and FICCI have taken a lot of interest in this sector, the government also needs to look the sector as an emerging industry and extend subsidies that are available for ITeS players." According to him, the government should look at this as a people-intensive, job creating industry that can also create jobs in rural India."

And there are other issues to be taken care of by the industry alone. According to Chandrashekhar, "The primary challenges of making inroads in the industry are the quality of work combined with the reliability and time factor. The usual assumption is that India cannot produce good quality creative work. And even if one is assured of quality, questions are raised about the reliability factor and the creative abilities. We need to assure the world that made in India animation work holds good on all the three parameters." Adds UTV Toons’ Mohan, "There is a need for a major shift in attitude towards work. While artists in
India tend to be laid back and do not work diligently, less talented animators from Egypt and Philippines achieve their targets with diligent ways of execution."

Also important is the need to shift focus from offering low cost products to a quality product. According to netGuruIndia’s Banerjee, "It would be really difficult and foolish to compete with the likes of China, Philippines, Ireland and Canada on the cost front. India has the potential to beat the competition over quality and I sincerely feel more international training should be arranged by the exiting organization. This would help the employees equip themselves with the international standard tools."

To sum it in SGI India Managing Director Dr Prasad Medury’s words, "The government needs to treat this business just like the software industry and offer incentives to set up export operations. The government and the private both need to address the need for training manpower, just as has been done in the case of mainstream software and now happening in the area of bio informatics. There is a lack of understanding in the Indian business circles about this market and hence the investments are lagging behind."

SHUBHENDU PARTH in New Delhi
With inputs from Easwardas Satyan and Rahul Gupta in Mumbai, G Shrikanth in Chennai and TV Mahalingam in Bangalore