Bollywood filmmakers blast Trump’s threat on foreign movies

India's film industry, a significant player in global cinema, is grappling with uncertainty following President Donald Trump's threat of a 100 per cent tariff on all foreign-produced movies.

With approximately 40 per cent of its overseas revenue originating from the United States, the industry is concerned about the potential financial ramifications of such a levy.

Filmmakers, producers, and distributors are struggling to assess the precise impact, given the lack of detail provided by the Trump administration.

"The real question is how the term 'foreign produced' will be defined, and until that's clear, it's hard to say anything," noted filmmaker Anubhav Sinha, known for the Netflix series IC 814: The Kandahar Hijack.

The ambiguity extends to crucial aspects of filmmaking, with Sinha adding, "It's not yet clear whether services like post-production will be affected."

The Indian film industry, which employs 272,000 people, generated around 20 billion rupees ($237 million) in overseas box office revenue in fiscal year 2024, representing a tenth of its total earnings, according to a report by Deloitte and the Motion Picture Association. The United States constitutes a substantial portion of this overseas market.

Several prominent Hollywood productions have featured scenes filmed in India, including Oscar-winning films like Slumdog Millionaire and Zero Dark Thirty, as well as popular titles such as Eat, Pray Love and The Dark Knight Rises. The proposed tariff raises questions about the future of such collaborations and the potential impact on both Indian and American film industries.

In the absence of details on the planned levy, film producers worry it could double the cost of exporting their films to the United States, where people of Indian descent are estimated to number 5.2 million.

"The United States is one of the most important overseas markets for Indian cinema, largely due to the substantial diaspora," said producer Madhu Bhojwani, reponsible for hits such as "Airlift", on workers evacuated from Kuwait during the Gulf War.

"Any increase in ticket prices resulting from these tariffs would directly affect audience turnout, compounding the challenges posed by evolving consumer behaviour and broader industry headwinds."

The cost-effective South Asian nation has also grown in stature as Hollywood's preferred hub for on-ground production and post-production services, especially in visual effects, since it offers a skilled talent pool.

"Almost 10 to 15 (foreign) movies are shot in India every year, and our movie industry will be impacted very badly," said film trade analyst Komal Nahta.

Prominent Indian actor and producer Prakash Raj called Trump's move "tariff terrorism".

If the tariff covers post-production services, the consequences will be bigger, added Bhojwani, the co-founder of Emmay Entertainment and Motion Pictures.

"We can expect a potential decline in outsourced work from U.S. studios to Indian vendors, which could have notable implications for the Indian media services sector," she said.

"If revenue from the U.S. drops, it could affect budget planning and profitability for Indian production houses," said Pradeep Dwivedi, chief executive of Eros International Media EROS.NS.

"Big-budget films counting on overseas revenue could be restructured or scaled back."

The move will also hurt smaller releases in the United States.

"Even a 30 per cent drop in revenue for such mid-scale movies would be a significant dent," said Raj Kandukuri, producer of a well-regarded film, "Pelli Choopulu", in India's southern language of Telugu.

"There are a sizeable number of students in the United States who watch movies, they will not spend high on ticket prices."

The planned levy might also drive a broader shift to digital platforms.

"U.S. distributors might be less inclined to pick up Indian titles due to the increased cost," Dwivedi said.

"This could result in fewer screens, smaller releases, and a shift toward digital platforms instead of theatrical. The tariff would likely accelerate a move toward direct-to-digital releases on platforms like ErosNow, Netflix, Amazon Prime, and Hulu."