By Shreya Narayan

A Case Study for films in Bihar

I chose Bihar because of its unique position of having a film industry to its name, alas, only in name! Andhra makes Telugu films, Tamil Nadu makes Tamil films and Bengal makes Bengali films, however, Bhojpuri films are not made in Bihar. Since it is a part of the Hindi heartland, it can also have a pie in the Hindi Film Industry, thus the choice.

Bihar has emerged as the fastest growing state in terms of gross state domestic product (GSDP), clocking a growth rate of 17.06 per cent in FY 2014-15, according to Brickwork Ratings. But as it has been a BIMARU state since last almost 30 years. And despite much progress made in last ten years, the image has stuck. Any Bihari in any part of the world will vouch for the loss of self-esteem that he/she has faced at some point in their lives due to Bihar’s poor image. It’s time to change the perception of Bihar in the eyes of the world. Image apart, the main reason to invest in a strong film industry is EMPLOYMENT. Bihar scores highest  amongst the unemployment rate states in India. Moreover, despite a ready and running industry to its name, Bihar does not earn revenues from the Bhojpuri film industry. But a new thrust to the film story in this new Bihar could be game-changer!

Why films, media & entertainment?


Films lift our spirits, broaden our minds, and transport us to places we never imagined. Films can do for our minds what distribution of bicycles has done for about 1.5 million girls in Bihar –mobility, freedom, and aspirations. These are enough reasons to be a part of them, or make them a part of us. But let us talk about the real issues.

Film Industry sub-sectors include Film Production, Film Exhibition, Film Post-production, Integrated Record/DVD/streaming Production, Music Publishing etc and they all imply money and employment. As on today, Indian film industry is a US$ 2 billion market. Yet, none of that money comes to Bihar. As per the FICCI-KPMG Report 2015, the Indian Media and Entertainment Industry (which includes Films, TV, Print, VFX/Animation/Gaming, Post-production and other ancillary services) is set to grow at a CAGR (compound annual growth rate) of 13.9%, to grow from INR 1026 billion (US$ 15.7 billion) in 2014 to INR 1964 billion (US$ 30.2 billion) by 2019, a growth rate that is almost double that of global media and entertainment industry. What is the share of Bihar in these billions of rupees story? The GSDP of Bihar stands at US$ 66.4 billion over 2014-15. The Media and Entertainment industry stands at US$15.7 billion. Should Bihar not attempt to have a pie in this sector, given that it already has a ready-made film industry to its name? Alas, Bhojpuri film industry is Bihari only in name.

About 150 Bhojpuri films are made every year. The Bhojpuri film industry’s worth is estimated in hundreds of crores. Bhojpuri films are a rage in Bihar, Jharkhand and Eastern UP. They have also been doing well in Punjab, Maharashtra and other regions including the Bihar/UP migrant communities. But the Bhojpuri film industry is located in Mumbai, not Patna, thereby benefiting Maharashtra with it’s revenues and employment opportunities, and not Bihar!


Image apart, the main reason to invest in a strong film industry is EMPLOYMENT. Bihar scores the highest amongst unemployment rate states in India.

It has 8% of India’s population but supplies no more than 1% of its workforce, and the better educated you are, greater the chances that you will be unemployed.

Of Bihar’s 104 million people, 28 million are between 15 to 30 years of age. That’s 27% of the population, which is lower than the national average of 30%, and lowest of India’s poorest states (Madhya Pradesh, Rajasthan, Uttar Pradesh, Chhattisgarh, Jharkhand and Odisha). However, unemployment for Bihari youth (15 – 29 age group) is higher at 17.5% than the national average of 13%. Compared to other parts of the country, more educated and qualified youngsters are unemployed in greater numbers in Bihar than youth who are illiterate or with lower education. These are the findings of an IndiaSpend analysis of the census, economic survey, unemployment and industries data. This is a cause of great worry. There is education and hard work, but no opportunities. Thus most of Bihar’s youth is engaged in agriculture, followed by construction and trade. It is time they stop being relegated to daily wage work, and are employed in service sectors with better quality job prospects.

Bihar had only 3,345 industries at the end of 2013, according to Annual Survey of Industries. That is 1.5% of the total, as against leading industrialised states, such as Tamil Nadu (16.6%), Maharashtra (13.03%) and Gujarat (10.17%). Of 12.9 million persons engaged across the Indian industry, Bihar accounted for only 116,396 people i.e. less than 1%. Bihar needs industries to provide employment to propel the growth engine of the economy, and fulfill young people’s aspirations.

On the employment front, the Media & Entertainment industry currently employs about 0.40 million people, this number is expected to grow to 1.3 million by 2022, translating into 0.9million additional employment opportunities during the period 2013-2022. M&E industry is highly dependent on human resource, thus employment growth and output value are strongly correlated. Out of the total number of people who work in Media and Entertainment sector in India, 35% people work in films. Of these, majority are contract workers/freelancers as opposed to full time employees. This is a very attractive side of having the film industry in Bihar. Every time a film crew comes to Bihar to shoot, it can employ a number of local Biharis.

Ancilliary services mean serious money

VFX/Animation/Gaming can change the game for Bihar! Constant upgradation of skills/technological changes/new techniques is a huge requirement in production and post production jobs in films. In 2014, out of the ten films nominated for Oscars in Best Visual Effects category; Indian VFX studios had performed outsourcing work for six!

Animation services is a INR 8.1 billion, animation production a INR 5.1 billion, VFX a INR 11.3 billion, and post production a INR 20.4 billion industry in 2014, thus totaling to about a strong INR 45 billion industry, a gold mine! 13 percent of all TV shows in India are animated, that itself showcases it’s demand. Uno Digital studio in Patna was amongst the pioneers in the field. Working in tandem with Legend3D, a San Diego based 2D to 3D conversion studio, they have colourised, restored 135 titles and converted films like “Alice in Wonderland”, “Pirates of the Carribean: On Stranger Tides”, “Shrek” and even “Transformers 3” from 2D form to 3D. India wasn’t even that aware of film restoration, colourisation and 3D conversion, when they started it. Thus there is a need to give impetus to such services.

Culture of creativity and competition brings investment

Does having a film industry in a state is all about revenues only? No. It’s also about image. Films and cricket foment deep bonds in Indians, and stand as representatives of Indians on the global platform. Both represent money and glamour. Any state where film industry is based, establishes that the state encourages art and culture. It also shows that it is a good place to live and invest by virtue of it being a safe place for women, with a workable environment that encourages eclectic thoughts and lifestyles. This image of Mumbai as a safe place with cosmopolitan culture is one of the reasons why foreign investors have always felt comfortable investing in Maharashtra. Thus, the culture of creativity and competition will demystify the existing image of Bihar, and bring investments.

It’s a case for improvement 

Bihar already has a culture of film production. Bhojpuri films employ a number of Biharis, who have to leave their land and travel to Mumbai to work in them. Hindi films have a number of Biharis working too, however, Mumbai forms their base. Thus there is an urgent need to bring back creative people to Bihar to make money for Bihar. Even a VFX studio, Uno Digital, has shown the way since the beginning of this century. Thus the foundation is already there. It needs to improve upon things for growth.

Bihar could be an alternative/additional hub for Bhojpuri/Hindi film industry by fostering competition.

Ready pool of educated workforce

The educated youth of Bihar are available to be utilized towards its growth story.  But Bihar must bring opportunities to its youth. Media and Entertainment Jobs would be strong avenue for the same. Also training institutes can be set up for training in VFX, Animation and gaming to further strengthen our youth’s vocation. Education has always been the backbone of Biharis. Polytechnics, Institutes and Film schools would crop up if government gives an impetus to films and related services.  Existing universities should be asked to include Film, Broadcast, Event Management and Digital technology in their curriculum.

Loss of Opportunities is loss of money

Development of Infrastructure

A village looks like a village because it has farming lands and small houses and markets. A city looks like a city because of skyscrapers, good, wide roads, and huge markets. Thus infrastructure development is key to any states development. This is where Entertainment tax comes into picture.

The table below lists the entertainment tax rate in India:

Sr No State Entertainment Tax Applicable on Gross Tkt Value
1 Andhra Pradesh 20% (15% for Telugu Films)
2 Assam, Himachal Pradesh, Jammu & Kashmir, Punjab and Uttaranchal Nil
3 Bihar 50%
4 Delhi                            20%(recently doubled to 40%)
5 Gujarat 20%
6 Haryana 30%
7 Jharkhand 110% (Nil for Jharkhand Films)
8 Karnataka 30% (Nil for Kannada Films)
9 Kerala 30%
10 Madhya Pradesh 20%
11 Maharashtra 45% (Nil for Marathi Films)
12 Orissa 25%
13 Rajasthan 30% (Nil for Rajasthani Films)
14 Tamil Nadu 15% (Nil for Tamil Films)
15 Uttar Pradesh 30% to 40%
16 West Bengal 30% (2% for Bengali Films)

© 2011 The Film & Television Producers Guild of India Ltd.

Government levies heavy taxes in two scenarios, either it wants to discourage a sector, or it sees that the sector is so heavily used by citizens that it can earn a lot of revenue through it for nation building. Any state that wants to protect or encourage their indigenous films, gives tax credits to that industry. This in turn makes the exhibitors show more of these films. This favours production of their indigenous films. High entertainment tax is good for rich states, where people have money to spend on entertainment, and shall do it despite the tickets cost rising a few hundred. Thus states like Maharashtra and Delhi can afford to keep high taxes, because people shall not be discouraged by high entertainment cost. Also they have huge investments already in infrastructure, and given their advantageous positions as top states in India with huge populations, they have only to gain by setting huge Entertainment taxes. But does this work for impoverished states?

Higher entertainment tax does dual harm to the economy of poor states.

By keeping the ticket prices high, it is discouraging poor consumers with difficult lives to go and find relief in acceptable entertainment. Thus people turn to cheaper means such as porn clips on phones or pirated copies of films, alcohol, or worst still, radicalisation. In poor states with high unemployment rates amongst youth, this has long-term consequences.

On the other hand, lower receipts and higher taxes is discouraging the single screen cinema owners to upgrade their facilities. It is well known that in Bihar, economically better placed families do not go to cinema halls due to poor facilities at the single-screen theatres. In this vicious cycle, the loss is ultimately of the state, which is mistakenly thinking that it is earning money through taxes. In truth, the state is losing money through lost opportunities.

Developing states like Bihar must keep their Entertainment taxes low to fuel growth of entertainment related services, and most importantly, infrastructure, to boost its economy. By lowering entertainment taxes, the state sends a message to businesses to come and invest in states entertainment infrastructure, which shall bring the rich into the cinema halls.

The government need not allocate lands to private parties, if it lets competition thrive, instead of curtailing it by discouraging more people to enter the film industry, malls and cineplexes business in Bihar. As per Bapaditya Basu, associate director of Jones Lang Lasalle Meghraj, realty and retail consultants to Prakash Jha’s company, P&M Infrastructure, which has been building malls and has been allocated lands in Bihar, “If it costs Rs 800 crore to set up a mall in Mumbai, Prakash Jha is setting up 30 malls at the same cost in Bihar,”. Which business would like to lose such an opportunity with eyes on the future?

Bihar should invite Film Infrastructure builders through competition and not through sops and land allocation. There is a reason why there is no need to give freebies.

All film financiers and businessmen know that India is severely under-screened. With just 1 screen per 96,300 residents, it is the world’s most under-screened major territory. The U.S., by contrast, has 1 screen per 7,800 residents. China, which until recently was even less saturated than India, has been on a cinema building binge and now has 1 screen per 45,000 residents. With such a deep shortage of movie theaters and screens, many of India’s fanatical movie fans are simply unable to see movies in the theater. And so Multiplex building is inevitable!

The second reason is that India’s movie theaters are sub-par. More than 10,000 of the country’s 13,000 screens are single-screen cinemas. The economics of these theatres are inferior to modern multiplex cinemas, which can charge ticket prices that are double those of single-screen theaters. And because they can operate more efficiently, multiplexes can generate higher capacity yields and revenues per seat. India clearly has an infrastructure problem. And so upgradation of existing theatres is inevitable too.

When businesses know that Bihar is serious about the film business, money for infrastructure will flow. Bihar is a valuable film distribution territory for films.

Reasons for loss of film work in Bihar 

If even Bhojpuri films are not shot in Bihar, how can it woo Hindi films ensconced happily in Maharashtra to make the move? Some of the reasons given by those who work in Bhojpuri films, as to why Bhojpuri films are not shot in Bihar, are:

Patna lacks proper film studios and technical equipment.

The artists are also available at a cheaper price in Mumbai (that is because artists have no opportunities in Bihar. They have to live in Mumbai to find opportunities. Bihar does not create or encourage new,upcoming artists. It likes to adopt them proudly once they have made their name. Then Bihar comes forward with some sops.)

The owners of film equipment in Patna demand cash payment. So, most films are actually shot in Maharashtra and Gujarat.

Extortionists and kidnappers, who had a free run in the state till Chief Minister Nitish Kumar cracked down on them, too, are responsible for driving directors and filmmakers away from Bihar.

Entertainment business cannot thrive at any place where governance is poor and women are deemed unsafe.

Shreya Narayan is an Indian film and television actress, model, writer and social worker.

Posted by The Indian Economist