Source: TelevisionPoint.com

The Andhra Pradesh government is scouting for fresh equity partners, who can invest around Rs 800 crore to build a world-class animation city in Hyderabad. A search is on as animation companies have failed to commit significant investments for the joint venture project with the state government.

The original proposal had envisaged the creation of a special purpose vehicle (SPV) in which animation firms would have an equity stake along with the state government which would provide the land. These companies were to infuse money for building the animation city in phases.

“We have shelved our original plan as animation firms do not have the wherewithal to make huge investment commitments, considering that the sector is nascent. We want to develop the project at one go rather than do it in phases. We are working on the investment guidelines for prospective bidders.” said, S K Joshi, IT secretary, Andhra Pradesh.

Animation firms including FX Labs, Suresh Productions, Gemini TV and DQ Entertainment featured in the list of prospective partners in the project to build infrastructure. But these firms will have to reckon with taking space on lease, after the government finds an equity partner for the project.

The state government is willing to allocate around 100 acres of land for the project which is estimated to cost around Rs 800 to 1,000 crore. Digital entertainment city, as it would be called, will have world-class infrastructure to support the businesses of animation, gaming, TV, film, multimedia, radio and music.

The animation market in India is estimated at $ 285 million at present and is expected to touch $ 1 billion by 2010. The infrastructure requirements for animation firms are growing as most of them are forging tie-ups with international players. The city will house training schools to groom animation professionals. Four animation training schools, Picaso, Toonz, Crux and Taksha Academy, are keen on setting up their academies here.

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