Start a Media & Entertainment Business in India

Industry Overview in India

India's Media & Entertainment (M&E) industry is the fifth-largest globally, valued at approximately USD 30 billion in FY 2024 and projected to reach USD 48 billion by 2030, growing at a compound annual growth rate (CAGR) of 9.8%. The sector encompasses film production and distribution, television broadcasting, digital streaming (OTT), animation and visual effects (VFX), gaming, music, print media, radio, live events, and advertising.

The rapid expansion of digital infrastructure has been a pivotal driver. India's total internet user base crossed 100 crore (1 billion) in June 2025, creating an unparalleled audience for digital content. The country now hosts more than 45 OTT platforms, with streaming revenue alone projected to cross USD 2 billion annually. India is also the largest film-producing nation in the world, releasing over 1,800 films per year across 20+ languages.

For foreign investors, India offers a rare combination of scale, linguistic diversity, and cost-competitive production. Post-production and VFX work in India costs 40-60% less than in the US or UK, making it a global hub for outsourced creative work. The Animation, Visual Effects, Gaming, Comics, and Extended Reality (AVGC-XR) sub-sector alone is projected to grow to INR 18,000 crore by 2025.

India's advertising market — the revenue engine for most media companies — is projected to reach USD 18-20 billion by 2027, driven by digital ad spend overtaking traditional media. The country has the world's cheapest mobile data rates (averaging INR 10-15 per GB), which has fueled a content consumption boom, particularly in Tier 2 and Tier 3 cities. Regional-language content is the fastest-growing segment, with Hindi, Tamil, Telugu, and Bengali content collectively generating more viewership than English programming.

The Indian mobile gaming market alone is valued at approximately USD 7 billion in 2025, with over 560 million gamers. India is the largest market globally by game downloads. The esports and live-streaming ecosystems are also emerging rapidly, attracting investment from international tournament organizers and streaming platforms. Sports broadcasting rights have become a major investment category, with IPL (Indian Premier League) cricket media rights alone valued at over USD 6 billion for the 2023-2027 cycle. The convergence of sports, entertainment, and digital platforms has created a new category of super-platforms that command massive audiences and advertising revenues.

FDI Policy & Entry Routes

India has adopted a progressive FDI policy for the media and entertainment sector, with most sub-sectors now open to 100% foreign investment under the automatic route. Here is a breakdown of FDI caps by sub-sector:

Foreign investors entering the non-news entertainment space face virtually no FDI restrictions. The sector does not attract Press Note 3 (2020) conditions since those apply primarily to investments from countries sharing a land border with India (China, Pakistan, Bangladesh, etc.), and require prior government approval regardless of sectoral caps.

All FDI transactions must comply with FEMA regulations, including filing Form FC-GPR with the RBI through the AD bank within 30 days of share allotment.

Required Licenses & Regulatory Bodies

The licensing landscape for M&E in India involves multiple regulatory bodies depending on the sub-sector. Here is a summary of key approvals:

Companies in the digital/OTT space benefit from a lighter licensing regime. OTT platforms do not require a broadcasting license but must comply with the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, which mandate content classification, grievance redressal mechanisms, and self-regulation through industry bodies.

Under the Telecommunications Act, 2023, the regulatory framework is shifting from prescriptive licensing to an authorization-based model, simplifying compliance for broadcasters and cable operators.

For gaming companies, there is currently no unified national gaming license, though individual states regulate real-money gaming differently. Goa, Sikkim, Meghalaya, and Nagaland have specific gaming legislation. Online skill-based gaming platforms must comply with GST at 28% on the full face value of bets placed, following the October 2023 amendment. Foreign gaming companies should conduct thorough state-by-state compliance mapping before launching operations.

Music streaming platforms and digital content distributors need to ensure compliance with the Copyright Act, 1957 (as amended), particularly regarding mechanical reproduction rights, public performance licenses, and synchronization rights. The Indian Performing Right Society (IPRS), Phonographic Performance Limited (PPL), and Novex Communications are the primary rights management organizations.

Entity Structure Options

Foreign companies entering India's M&E sector most commonly set up one of the following structures:

• Wholly Owned Subsidiary (WOS) — The preferred choice for studios, OTT platforms, and production houses. A Private Limited Company under the Companies Act, 2013, allows 100% foreign ownership and is eligible for all sectoral incentives. Netflix India, Amazon India, and Disney (now JioStar) all operate as wholly owned subsidiaries.
• Limited Liability Partnership (LLP) — Suitable for creative agencies, boutique post-production firms, or consulting outfits. LLPs have lower compliance burdens but cannot accept FDI under the government-approval route, limiting them to sub-sectors where 100% automatic-route FDI is allowed.
• Branch Office — Used by foreign broadcasters or news agencies to maintain a presence without setting up a full subsidiary. Suitable for representative or liaison activities but cannot engage in manufacturing or production.
• Liaison Office — Appropriate for foreign media companies exploring the Indian market. Cannot earn revenue in India; limited to market research, brand promotion, and coordination.

For most foreign investors, a wholly owned subsidiary offers maximum flexibility — it can hold licenses, earn revenue, repatriate profits, and attract further investment. Read our detailed India entry strategy guide to compare options.

Tax Incentives & Government Schemes

The Indian government has introduced several incentive structures to accelerate growth in M&E, particularly in the AVGC-XR space:

National AVGC-XR Mission

The government established the AVGC-XR Promotion Task Force in 2022, chaired by the Secretary of MIB, to create a comprehensive policy framework. The Task Force has recommended dedicated CoEs (Centres of Excellence), industry-academia partnerships, and incentive structures for animation, gaming, and VFX exports. Several states have responded with their own policies:

• Maharashtra AVGC-XR Policy 2025 — Aims to grow the state's AVGC-XR sector from INR 25,000 crore to INR 65,000 crore in five years. Offers 25% capex subsidies, employment generation incentives, and IP protection assistance.
• Madhya Pradesh AVGC-XR Policy 2025 — Provides 25% capital expenditure subsidy (up to INR 30 crore), rent assistance for 3 years, and 50% of IP registration costs.
• Karnataka, Telangana, and Tamil Nadu — Also offer sector-specific incentives including land allocation, subsidized power, and talent development programs.

Startup India Benefits

M&E startups registered under Startup India can claim a 3-year tax holiday under Section 80-IAC, self-certification for labour and environmental compliance, and access to the Fund of Funds for Startups (FFS).

Section 115BAB — Lower Corporate Tax

New manufacturing companies (including those setting up animation studios, VFX labs, or gaming production facilities) incorporated after 1 October 2019 can opt for an effective tax rate of approximately 17%, compared to the standard 25.17% rate.

Export Incentives

Media content exports — including VFX rendering, animation, and post-production services — qualify for benefits under the Foreign Trade Policy 2023, including Remission of Duties and Taxes on Exported Products (RoDTEP) for eligible services.

Key Compliance Requirements

Beyond standard company law compliance (annual filings, board meetings, statutory audits), M&E companies in India must navigate sector-specific regulations:

• Content Regulation — OTT platforms must follow the IT Rules, 2021 (as amended), including appointing a Grievance Officer, Chief Compliance Officer, and Nodal Contact Person for platforms with over 5 million users. Content must carry age-based classification (U, U/A 7+, U/A 13+, U/A 16+, A).
• FEMA Compliance — Foreign-owned entities must file Annual Return on Foreign Liabilities and Assets (FLA Return) by 15 July each year. Royalty payments, content licensing fees, and distribution agreements with overseas parent companies must comply with transfer pricing norms.
• GST Compliance — GST registration and filing is mandatory. Entertainment and amusement services attract 18% GST; cinema exhibition attracts 12% (tickets up to INR 100) or 18% (tickets above INR 100). Digital advertising services attract 18% GST.
• Intellectual Property — Trademark registration and copyright registration are critical for protecting content IP. India is a signatory to the Berne Convention and the WIPO Copyright Treaty.
• Labour Law — Film and entertainment productions must comply with the Code on Wages, 2019, and state-specific Shops and Establishments Acts for studio and office workers. Child artists require special permissions under the Child and Adolescent Labour (Prohibition and Regulation) Act, 1986.
• Foreign Exchange Remittance — Dividend repatriation and royalty payments must follow RBI's Master Direction on Foreign Investment, with proper cross-border payment documentation.

Setting Up Operations

Here is a practical step-by-step timeline for a foreign company setting up an M&E subsidiary in India:

Total typical timeline: 3-6 months from decision to operational readiness (excluding broadcasting licenses, which can extend to 9+ months).

Estimated initial costs:

• Company incorporation: INR 15,000-30,000
• Registered office setup: INR 50,000-2,00,000/year (varies by city)
• Resident director compliance: INR 1,00,000-3,00,000/year (if using a nominee)
• Professional fees (legal, CA, CS): INR 2,00,000-5,00,000 for the first year
• Broadcasting/license fees: Variable (FM radio license can cost INR 1-50 crore depending on city and frequency)

For a complete checklist, refer to our company registration checklist.

Case Studies: Major Foreign Players

India's M&E market has attracted significant foreign investment from global media giants. Here are notable examples:

Netflix India

Netflix entered India in 2016 and has since invested over USD 1 billion in Indian original content. It operates as a wholly owned subsidiary (Netflix Entertainment Services India LLP, later restructured). The platform produces content in Hindi, Tamil, Telugu, Malayalam, and other languages, with titles like Sacred Games, Delhi Crime, and Lust Stories gaining international acclaim. Netflix India reportedly crossed 40 million subscribers by 2025.

Amazon Prime Video India

Amazon launched Prime Video in India in 2016. It has commissioned hundreds of Indian originals across languages and acquired streaming rights for major cricket tournaments. Amazon's M&E investment in India exceeds USD 500 million.

Walt Disney / JioStar (formerly Disney+ Hotstar)

Disney entered India through its acquisition of 21st Century Fox's Star India business in 2019. In 2024, the Disney-Star merger with Reliance's Viacom18 created JioStar, India's largest entertainment entity. The combined platform commands over 100 million streaming subscribers and controls major cricket and entertainment broadcasting rights.

Sony Pictures Networks India

Sony established its India operations through Sony Entertainment Television in 1995 and expanded to include multiple Hindi, Tamil, Telugu, and Marathi channels. Sony's merger with Zee Entertainment was called off in 2024, and the company continues to operate independently with a significant market share in general entertainment and sports broadcasting.

Warner Bros. Discovery India

Warner Bros. Discovery operates multiple channels in India including HBO, Cartoon Network, Discovery, and CNN-News18 (through a partnership). The company's India operations span content licensing, theatrical distribution, and direct-to-consumer streaming.

International Gaming Studios

Several major international gaming companies have established India operations to tap into the country's massive gaming audience and cost-effective development talent pool. Ubisoft, Electronic Arts, Zynga (now part of Take-Two Interactive), and Riot Games all maintain development studios or offices in India, primarily in Bangalore, Hyderabad, and Pune. These studios handle game development, quality assurance, and live operations for global titles. The trend of international gaming companies setting up India studios has accelerated since 2020, driven by a combination of strong engineering talent at competitive costs and the domestic market's explosive growth potential.

Frequently Asked Questions

Can a 100% foreign-owned company produce and distribute films in India?

Yes. FDI up to 100% is permitted under the automatic route for film production, exhibition, and distribution. No prior government approval is needed. The company must be incorporated in India (typically as a Private Limited Company) and comply with CBFC certification requirements for theatrical release.

What FDI restrictions apply to OTT streaming platforms in India?

Non-news OTT platforms can receive 100% FDI under the automatic route. However, OTT platforms streaming news and current affairs content face a 26% FDI cap with mandatory government approval. Platforms must also comply with the IT (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.

Is a broadcasting license mandatory for all media companies in India?

No. A broadcasting license is required only for TV channels, FM radio, DTH, and cable network operators. Film production companies, OTT platforms, digital content creators, gaming studios, and advertising agencies do not need broadcasting licenses. OTT platforms must comply with the IT Rules but do not need a MIB broadcasting license.

What is the AVGC-XR sector and why is it significant for foreign investors?

AVGC-XR stands for Animation, Visual Effects, Gaming, Comics, and Extended Reality. India's AVGC-XR sector is projected to grow to INR 18,000 crore by 2025. Multiple states (Maharashtra, Madhya Pradesh, Karnataka, Telangana) offer dedicated incentive policies including capital subsidies, rent assistance, and employment-linked benefits. The sector allows 100% FDI under automatic route.

How long does it take to set up a media company in India?

Company incorporation takes 7-15 days. Total setup including bank account opening, capital infusion, and GST registration typically takes 6-8 weeks. If broadcasting or FM radio licenses are required, the timeline extends to 6-12 months due to security clearances and technical approvals.

Can foreign media companies repatriate profits from India?

Yes. After paying applicable corporate tax (25.17% standard rate or ~17% for new manufacturing companies), foreign companies can freely repatriate dividends to parent companies abroad. Dividend distribution does not require RBI approval but must follow FEMA guidelines and applicable DTAA provisions to optimize withholding tax rates.

What tax rate applies to media and entertainment companies in India?

The standard corporate tax rate for domestic companies is 25.17% (including surcharge and cess). New manufacturing companies (animation studios, VFX facilities) incorporated after October 2019 can opt for a concessional rate of ~17%. Startups recognized under Startup India can claim a 3-year 100% tax holiday on profits.