Highlights of the IMAGE Policy – 2016

The Government of Telangana unveiled, among other IT policies, the IMAGE policy on April 4, 2016, for the Animation, Visual Effects, Gaming & Comics Industry (AVCGI).

Before we dive into the policy and its details, some number crunching for you to understand the opportunity size, which is Himalayan by any count:

  1. The Information and Communication Technology sector are recording a 17% growth and stand at USD 17 billion and make up 40% of exports from the state.
  2. The IT industry employs 4.5 lakh people in the state.
  3. The state’s IT industry ranks second in its performance compared to other states in India.
  4. Gartner reports that by 2019, the global IT spend will reach USD 3.9 trillion.
  5. Indian IT Industry has crossed the USD 147 billion mark recording a growth of 13%. It includes the domestic contribution worth USD 48 billion to the overall growth.

Now, on to the policy highlights:

Objectives

  • Make Hyderabad the most favoured destination for the AVCG industry.
  • Support for the development of manpower, infrastructure, and business.
  • Spread awareness about and create employment in the AVCG industry.
  • Strive for a larger share of the global outsourcing opportunity.
  • Creation of a framework for promoting IP creation and protection.
  • Promotion of local digital content for the education and entertainment for Indians.

The Government of Telangana proposes to achieve these objectives through these policy and strategy measures:

Infrastructure

Telangana State Industrial Infrastructure Development Corporation (TSIIC) to become the nodal agency for developing and managing the infrastructure for the AVCG industry. Also, reputed private developers are expected to play a crucial role in the infrastructure development.

IMAGE City

The IMAGE city for Animation and Gaming will be set up in the Ranga Reddy district on the lines of the Media City in Dubai, UAE, and the Dutch Games Gardens in the Netherlands. The city will be a world class facility to promote Animation and Gaming.

Training

An academy to impart training in the AVCG sector will be established to create the talent pool and foster entrepreneurship. The government will also promote AVCGI courses and expert talks.

TASK

The Telangana Academy for Skill and Knowledge (TASK) will play a major role in skill development for the AVCG sector.

Incubation

The Government of Telangana and the Software Technology Park of India (STPI) together have created an incubation centre dedicated to the AVCG industry. The Government of Telangana is also creating a funding mechanism to fund startups in the sector.

Reservation of Air Time

The Government of Telangana will coordinate with the Government of India to ensure that 5 to 15% of the air time for digital entertainment content is the content made in India.

The Government of Telangana has announced many fiscal incentives:

  1. 25% capital investment subsidy subject to terms and conditions.
  2. Reimbursement up to 20% of the production cost, if 80% of the production cost is incurred in Telangana.
  3. Exemption from the entertainment tax for animation VFX theatre film produced and released in Telangana.
  4. Reimbursement of internet charges up to 3 lakhs per annum for a maximum of 3 years.
  5. SC/ST/Women entrepreneurs will enjoy additional benefits if they have 51% stake or higher in an AVCG business.
  6. AVCG companies are exempted from statutory power cuts and will be encouraged to use renewable energy.

 

Apart from these major policy initiatives, the drive and the expectations based on realistic and optimistic industry factors and confidence were palpable on April 4, 2016, at the Hyderabad International Convention Centre, Hyderabad, where the Government of Telangana launched the policies.

The hall was filled with the bigwigs of the IT industry, the political and administrative heads of various departments and also entrepreneurs, students, and heads of IT companies of all sizes and shapes.

By arriving well ahead of the scheduled start time, the IT Minister Sri K.T. Rama Rao was the first person to send the signal to the industry, that the government means business. And the meeting started dot on time. Do we need to say more?

Happy Gaming.

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