India's storied film industry is at a crossroads. A combination of big-budget failures, declining theater attendance, and shrinking content pipelines has created what many are calling a prolonged slump. In response, a growing number of filmmakers are making a bold bet on artificial intelligence to mount large-scale projects at a fraction of traditional costs.
The Rise of AI Film Festivals
The shift toward AI was palpable at Mumbai's first-ever 'AI Film Festival' held on a rainy November evening. The historic Royal Opera House was buzzing with young creatives who gathered for a hackathon, creating short films entirely with generative AI tools. The jury included prominent figures like creator Tanmay Bhat and Hindi film directors Karan Anshuman and Shakun Batra.
This event, sponsored by Peak XV-backed video-creation firm InVideo, came under scrutiny on social media. Many critics expressed disappointment that Mumbai was hosting an AI film festival in the same year the prestigious MAMI Film Festival was absent. Meanwhile, the International Film Festival of India (IFFI) in Goa is also embracing the trend, screening 27 AI-generated films from around the world in its own AI competition section.
Driving Forces Behind the AI Push
The industry's challenges are significant. According to media consulting firm Ormax, domestic footfalls in 2024 declined 6% to 883 million, falling below not just pre-pandemic 2019 levels but even those from a decade ago. Streaming platforms have sharply reduced spending on original content, preferring to acquire theatrical releases instead.
Vijay Subramaniam, founder of talent management and content firm Collective Artists' Network (CAN), is among those leading the AI charge. His company plans to produce 3-4 AI-made films for theatrical release, starting with 'Hanuman' in early 2026. "Why AI? It would have taken me seven years to make this otherwise," Subramaniam explained. "I am a firm believer in technology to make content faster, better, and more economical."
Other notable projects include Shekhar Kapur's science-fiction series 'Warlord' with Mumbai-based Studio Blo, which will be created entirely using generative AI. Studio Blo is also developing 2-3 AI-powered animation films for big-screen release. According to founder Dipankar Mukherjee, AI reduces movie costs and production time to less than half of traditional feature films.
Skepticism and Technical Challenges
Despite the enthusiasm from some quarters, exhibitors and mainstream filmmakers remain skeptical about AI-generated entertainment's potential for feature-length films and theatrical releases.
Filmmaker Ram Madhvani voiced concerns about emotional connection: "Unless the audience believes the character, and feels emotionally connected to what's happening on screen, and if the cinematic illusion breaks, the audience does not want to pay for the content."
Rahul Puri, managing director of Mukta Arts and Mukta A2 Cinemas, suggested that AI content might initially replace animation but faces significant hurdles in mainstream cinema. "At this point, the technology isn't sophisticated enough for people in cinemas to suspend disbelief around what seems like a comic book coming to life," he noted.
As the industry navigates this technological transformation, the fundamental question remains: when audiences are hesitant to visit theaters even for big-star films, will they embrace AI-created characters on the big screen? Proponents like Subramaniam believe that with strong storytelling, effective marketing, and proper distribution, the answer could be a resounding yes.
