In 2001, film was accorded industry status by the Indian Government this making it eligible for film financing from banks and financial institutions while the Industrial Development Bank of India (IDBI) set up the countrys first film fund worth 100 crores.  Cable television is the largest revenue earner with television broadcasting in second place and film third, followed closely by television production.

The future primary drivers for the entertainment industry will be growth in GDP, changes in demographic and the adoption of digital technology by the industry.

Negative Fallout: No excise duty on CD ROMs, but excise duty is levied on the audio  CDs and video CDs although the manufacturing process, requirement of raw material and plant requirement for three types is the same.  On top of it, a 4% excise duty as been imposed on MRP with regard to audiocassettes.  No abatement has been offered with respect to this service tax on broadcast services.

In the entertainment segment, the films sector has been given the Industry status by the government.  Estimates show that the entertainment industry is currently generating revenue of Rs. 100 billion and this will be able to increase by Rs. 315 billion by the year 2005.  These measures include allowing listing to a company with 10% public ownership skin to the information technology industry.  The FM radio broadcasting has been privatized.  The current size of film segment, according to the latest estimate, is worth Rs. 22 billion. The average growth budget for the films has been increasing by 15% per annum.

Another high growth segment of the entertainment industry is the television broadcasting.  The present size of this segment is estimated to be Rs. 35 billion.

The subscription revenues of the television channels are estimated to be around Rs. 25 billion currently.  There are thirty five million households having access to about seventy channels the cable networks.  The penetration of cable TV, particularly in the rural segment is expected to grow by 12% in the coming years.

The music industry is dominated by MC sales rather than CDs.  The music industry in India is expected grow rate of 18-20% in the coming years.