Policy frictions and the case for reform

Cost pressures remain a persistent concern. Multiplexes pay electricity tariffs closer to commercial rates, which are significantly higher than those for many other consumer categories. Ticket pricing is further constrained by state-level caps and a GST structure that imposes 18% tax on tickets priced above ₹100—a threshold unchanged since 2017 despite cumulative inflation of over 40% during that period.

The EY report argues that these frictions limit the sector’s ability to invest, innovate and expand into underserved regions. Around 16,350 of India’s 19,000 pin codes have no cinema screens at all. EY estimates that doubling the national screen count to 20,000 could generate about 1.25 lakh additional jobs and nearly ₹950 crore in incremental tax revenues, provided regulatory bottlenecks are eased.

Rather than prescribing solutions, the study lays out a set of policy considerations for discussion. These include rationalising GST thresholds, granting industry status to cinema exhibition to lower input costs, allowing greater flexibility in ticket pricing, and encouraging longer theatrical windows through industry consensus. It also flags the potential for cinemas to diversify revenue by hosting live events, sports screenings and community activities, particularly during non-peak hours.

MAI said the findings are meant to inform dialogue with policymakers at a time when theatrical exhibition is undergoing structural change, not merely a cyclical slowdown. The association represents over 11 cinema chains operating more than 550 multiplexes and around 3,000 screens nationwide.

As digital platforms continue to reshape how Indians consume entertainment, the report’s central argument is that cinemas still matter—economically and culturally—but their survival will depend on whether regulation evolves in step with the market realities they now face.

Cinema Exhibition

India’s cinema exhibition industry seeks policy reset amid rising costs and shrinking footfalls