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Tuesday, November 11, 2008

Financial Crisis Pinches Bollywood Too


The fumes of the global economic meltdown have started effecting Bollywood big time as major production houses start cost-cutting.Apparently, T-Series CEO Bhushan Kumar has asked Director Pooja Bhatt to reduce the budget of her Himesh Reshammiya starring Kajra Re. The production house is also reconsidering its projects that are starring expensive stars like Salman Khan and Akshay Kumar.Bollywood trade analyst Komal Nahata confirms, “The slowdown has been felt in the industry rather slowly, but it has now caught up with it…However, it is difficult to say whether this has happened as a result of the global impact or due to the box-office disasters of recent big-budget movies, like Drona, Kidnap and Karzzz. But a sense of insecurity now pervades all production concerns, more so in Bollywood’s corporates houses.”

Director of a production house called Percept Picture also added saying, “Recently, two Bollywood corporate houses incurred losses to the tune of Rs 160 crore and Rs 60 crore, respectively. Naturally both have now put on hold their planned acquisitions. This was bound to happen. But it has happened sooner than we expected.”Kishore Lulla of Eros International explains, “Look, with the liquidity crunch in the market, people now have less disposable income and so they will now spend less on luxury and entertainment - which means the movie-going clientele will decrease and so will the box-office collections.“This will first affect the exhibition and distribution sector and consequently the production sector as it will have less money coming in from the two main sources - film exhibition and distribution. With less money on hand, producers will be forced to cut cost before the system gets corrected.”



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