After Budget backs AVGC skilling, the business of IP remains unfinished

The Union Budget backs skilling across animation, gaming and comics. But creators and studios confront a hard question: who owns what comes next?

Most of the Union Budget 2026-27 read as expected, but one section stood out beyond its usual readership. 

The animation, visual effects, gaming and comics (AVGC) sector featured in the document with a ₹250 crore allocation for AVGC content creator labs, signalling a policy push towards a segment that has long sat at the edges of official recognition. 

The proposed labs are to be rolled out across 15,000 secondary schools and 500 colleges, with implementation support from the Indian Institute of Creative Technologies in Mumbai. Folded into the creative, or ‘orange’, economy, the emphasis was firmly on skilling, talent pipelines and expanding production capacity across the creative industries. 

What remains harder to organise is what comes after production. Questions of ownership across multiple platforms, and of whether a created work can sustain relevance and commercial life beyond its initial release, tend to surface later in the value chain, often after scale has already been achieved. 

Where the value sits 

This is where intellectual property, or IP, comes in. It refers to the ownership of characters, narrative universes or formats that allow those properties to move across media, products and time, remaining commercially relevant beyond a single release. 

Globally, ownership rather than mere content creation carries significant economic weight. The character licensing industry is estimated to generate more than $300 billion annually worldwide. Hello Kitty, created in 1974 by Japan’s Sanrio, for instance, is estimated to generate around $4-5 billion annually, largely through consumer products rather than screen-led franchise cycles. 

Omnipresent 

India has never lacked AVGC characters. They have appeared across comic books, afternoon television slots, animated blocks, dubbed series, cinema halls and, more recently, OTT platforms, making recognition widespread. But commercial depth remained limited because characters were built for reach rather than returns. They travelled widely, but rarely beyond their original formats, functioning more as cultural references than as properties with long commercial lives. 

Crybaby is a character built as collectibles whose IP is owned by Chinese designer toy firm Pop Mart | PHOTO: Omoi studio, ACK

 

“India historically built familiarity, but not fandom-led consumption,” said Deepesh Kothari, vice-president of Amar Chitra Katha, which publishes Indian-themed comic books built around mythological as well as historical characters – from the Ramayana and Mahabharata to Akbar and Gandhi and fictional favourites such as Shikari Shambu. The early focus, he said, was access — reaching households across languages and income groups at a time organised retail and licensing infrastructure barely existed. 

That approach helped build scale and trust, but it also meant characters were rarely conceived with long commercial lives in mind. “The ecosystem required to monetise IP at scale was largely absent,” Kothari said. “Licensing never developed as a professional discipline, retail remained fragmented, and stories largely stayed where they were born.” 

That legacy of trust and reach, Kothari said, is now being repurposed as organised retail, e-commerce and digital discovery have expanded in India, allowing older IPs to extend beyond print into products, formats and partnerships. 

Where stories stalled 

From an industry-wide perspective, character IP in India often struggles to translate when stories are expected to move across formats, said Ajitesh Sharma, president of the Indian Comics Association. The world’s largest franchises, such as the Marvel Cinematic Universe, he noted, did not begin as spectacles but evolved gradually, often starting in comic books and being allowed to age before they were scaled. 

India missed much of that conversion window through the 1990s and early 2000s, Sharma noted. Comics did not reliably become games, games did not become films, and stories rarely renewed themselves, even as recognition endured. 

The imbalance is visible globally. The Netflix supernatural horror serial Stranger Things, for instance, has generated more than $1 billion in cumulative merchandise and licensing revenue since its launch, according to industry estimates. Much of that value has come not from new episodes but from demand across consumer products and live experiences, including themed events and immersive fan exhibitions. 

Fandom without follow-through 

Consumer behaviour reinforced the pattern, Sharma said. Comics and games were long treated as indulgences rather than environments to inhabit, with parents tolerating them but rarely encouraging deeper immersion, while video games were actively discouraged until the rise of esports. 

But then the world of distribution began shifting: Railway station bookstalls disappeared, independent bookstores shut and large-format retail shrank, narrowing the physical spaces where characters were discovered. 

There was also a creative ceiling. Much of India’s character ecosystem was built primarily for children, Sharma said, which allowed it to work early on but limited its ability to grow with audiences over time. By contrast, American superhero characters are continually reinterpreted, with new writers and artists reshaping them across successive comic runs and adaptations, so the characters grow with the readers.  

From a licensing perspective, the constraint has been less about demand and more about range, said Gaurav Marya, chairman of License India, an industry platform focused on brand licensing, merchandising and IP monetisation. While character licensing in India has grown in recent years, it has been built around a small number of properties, limiting how value multiplies over time. For licensing to compound, the same IP needs to reappear across multiple product categories and price points over time, allowing consumers to return to it repeatedly rather than encounter it once. 

“The issue is not whether licensing works,” Marya said. “It’s that we don’t yet have enough Indian-origin IPs created with licensing, retail and consumer products in mind from the outset.” 

He added that while content creation in India has scaled rapidly, monetisation through licensing is rarely built into IPs at the creation stage, restricting how far characters travel beyond their first format. 

Marya said many Indian companies still do not view their own brands and characters as licensable assets, which continues to limit the depth and diversity of India’s licensing ecosystem. 

Capacity first 

This is the terrain the Budget is now acting on. 

Government and industry estimates suggest India will need close to two million AVGC professionals by the end of the decade, driven by gaming, which has emerged as the largest revenue earner within the cluster, with India’s market estimated at $6 billion in 2025. Skilling initiatives are likely to expand the talent pool and production capacity, but questions around ownership and how to build value remain unresolved. 

What remains structurally underbuilt, industry experts said, is the layer between creation and visibility, where marketing, publishing and early losses determine whether new IPs ever get seen enough to endure. 

Learning from repetition 

Some new studios are approaching that gap cautiously, watching where IP already appears to hold before deciding how to build it. 

At New Delhi-based Omoi Studio, founder Aditya Ganguly began noticing character-led businesses overseas that remained visible without relying on films or series. One reference point was Crybaby, a pouty, teary-eyed character built as collectibles, owned by Chinese designer toy company Pop Mart, which also owns IPs such as Labubu, a wide-eyed, sharp-toothed doll with exaggerated features, and Molly, a childlike figure with oversized eyes and a fixed, expressionless gaze.  

Designed primarily as physical collectibles, these characters circulate through blind-box toys – mystery packages – Pop Mart’s retail stores, online platforms and licensed consumer products rather than through films or television. “What stood out wasn’t scale,” Ganguly said. “It was how often people were encountering the same characters.” 

That observation shaped how Omoi approached its first IP. Rather than beginning with a show or narrative universe, the studio began with a digital product, with characters designed to sit quietly on a user’s desktop during the workday. Omoi’s first set of characters, called Odies, are being developed across digital products, games and, eventually, collectibles, with the studio testing whether familiarity can be built through repetition rather than spectacle. 

It remains an early experiment. “You’re absorbing costs before you know whether the attachment will deepen,” Ganguly said. The attempt sits somewhere between legacy IP and mass entertainment – like a test case for how character ownership might be built incrementally. 

Owning the arena 

For many Indian studios, the harder shift has been moving from execution for global platforms to owning the systems and audiences those platforms depend on. 

Not everyone is approaching ownership through characters. NODWIN Gaming, one of the country's largest esports and gaming companies and a key organiser of competitive gaming tournaments and broadcasts, frames ownership less around individual titles and more around formats. “While the world often defines gaming IP as ownership of the underlying game — the software and its code — we define it as the community and the arena,” said Nishant Patel, senior vice-president. 

Games are inherently hit-driven, Patel said, while formats tend to endure longer. NODWIN’s focus has therefore been on building events, broadcasts and platforms that can travel across titles, rather than on developing a single breakout game. 

The Budget, he added, strengthens the front-end of the ecosystem by proposing allocations for expanding talent and production capacity. What remains more fragile is the go-to-market risk, particularly the capital required to ensure that new IPs are seen, sustained and are able to compound over time. 

Remaining gaps 

The picture remains incomplete, however. The Budget has moved decisively on capacity, but ownership is still being worked out unevenly across the ecosystem, with studios experimenting at different points in the value chain. 

One test is the time it takes for recognition to turn into revenue. If that gap remains unaddressed, new IPs risk stalling after production, repeating a cycle where scale arrives faster than staying power. 

India does not lack output. What remains uncertain is which characters, formats or worlds will stay in circulation long enough to be owned, renewed and compounded over time. 

In comparison

• India’s licensing market is nearly 2% of Pokémon’s lifetime value
• India’s animation sector is 6-7% of MCU’s box office
• Pop Mart alone is nearly the size of India’s entire character licensing ecosystem
• India has 500 mn+ gamers, but captures only about 2% of global gaming revenue
• India represents less than 1% of global licensing retail sales
• Global animation is 200x larger than India’s animation industry
• India contributes well under 1% of global animation value