Opportunity for Indian films as China curbs Hollywood imports amid tariff war

China works on a quota system for foreign films, and has prioritized American movies so far. But that could change with the latest curbs, making room for 20-30 Indian films to be showcased in that country annually. Earlier this year, Nithilan Saminathan's Tamil action thriller Maharaja, starring Vijay Sethupathi, earned ₹100 crore in China, emerging as the highest-grossing Indian film in the country in five years. 

While the Chinese market generated massive revenues for Indian films such as PK, Dangal, and Hindi Medium, the trend lost momentum after the Galwan valley military clash of 2020 ratcheted up tensions between New Delhi and Beijing. Tensions between the two nations have since eased, and with curbs on Hollywood, Indian films have an opportunity to capture a larger market share in China's movie market.

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“While Hollywood continues to remain a big draw and may not remain completely banned in China in the long term, Indian filmmakers will be more than happy to supply films (to fill the gap that has been created). China should be open to foreign films at this point, especially those that seem relatable to their audiences, and India is a market they would like to tap for sure," film producer and distributor Yusuf Shaikh said. Also, it is not uncommon for Hindi and other Indian language movies to find traction in non-traditional overseas markets, be it France or Japan.

From hits to hopes

A senior executive at a film studio, which has released films in China earlier, agreed that there is an opportunity for Indian filmmakers to tap into right now. Other than Maharaja, Indian titles such as Sushant Singh Rajput’s Chhichhore, Tamil film Kanaa and Ajay Devgn’s Drishyam have released in China after the covid-19 pandemic to fill the void left by its local film industry. 

These, however, failed to make a mark. “The distribution in China is really fragmented and it is up to Indian producers to reach out to them and negotiate terms. It is easier for producers who have a pipeline of movies and can release them regularly," the executive added.

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To be sure, the Bollywood success story in China began more than a decade ago with Aamir Khan’s 2009 film 3 Idiots, which made ₹16 crore there. Over the years, Khan emerged as a huge draw in the neighbouring country, following up with PK ( ₹123 crore), Dangal ( ₹1,200 crore) and his production, Secret Superstar, ( ₹700 crore).

Other hits came with Irrfan Khan’s Hindi Medium ( ₹300 crore) and Ayushmann Khurrana’s Andhadhun ( ₹324 crore). Film trade experts said a large screen count helped Indian films manage impressive theatrical returns in China. The country has almost quadrupled its screen count from about 10,000 over the past few years. India, on the other hand, operates with a little over 9,900 screens. Further, the average ticket price in China is higher than in India.

“Hollywood did contribute a significant chunk of the Chinese box office, so technically there will be a slowdown (in terms of new content) and distributors and cinemas will have to look for new options, so there is definitely an opportunity," film producer, trade and exhibition expert Girish Johar said.

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The US last week imposed a steep 245% import tax on a wide range of Chinese goods, after Beijing retaliated with a 125% levy on American imports and also tightened exports of rare earth metals critical to high-tech and defence sectors, against Washington's 145% tariffs earlier this month.