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Q. India’s film industry and transparency issues: Comment on the need of transparency in the Indian film industry.
May 04, 2017 Related to : GS Paper-2

Ans :

Introduction-

Recently the movie Bahubali has made blockbuster opening and its opening erning has been crossed 400 crores, which is nearly as twice as its production cost. Recently Malayalam film producer has announced 1000 crore budget movie, which is going to be most expensive move till date in the Indian film history. In recent times we have witnessed various big budgets movies even after low returns, many cites underworld and black money as reason for it, which must be addressed effectively.  

Analysis-

  • Every film is a risky venture, high budget movies posses’ high risk. The sheer scale of investment, which is largely cash-driven, makes a compelling case for the industry to organise itself better, become transparent and pay their due share of corporate tax.
  • According to report of the KPMG India-Ficci Media and Entertainment Report 2017, Bollywood movies have experienced negative growth rate. But still the investments in movies are growing up. Many cite the role of black money and influence of underworld.    
  • Considering the accusation of black money and role of underworld, film industry running like any other organised business will allow production companies to set off their losses against profits from hits.
  • Similarly in the backdrop of high entertainment tax in present taxation system, goods and services tax should bring some relief on the entertainment tax front. Producers must show their investment and profits, also pay taxes sincerely. 

Conclusion-

The film industry has been accused of misleading the investments and profits related to movie and help many black money holders in converting them into white. Hence film industry like any other industry should follow the ethics of corporate governance and should declare their accounts sincerely.


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