India's AVGC Policy Wave Meets Japan's Anime Studios

India Japan Kaizen — Pop Culture Bridge Series, Part 2

Part 1 of this series covered the scale on both sides — a record $25 billion year for Japan's anime industry, India as its third-largest audience by viewership — and closed with a promise: a closer look at India's own AVGC (Animation, Visual Effects, Gaming, Comics) push, and where Indian studios and Japanese IP holders are already finding each other. In the weeks since, both halves of that promise got a lot more concrete, largely independently of each other.

India's AVGC Policy Wave Finally Has Numbers Attached

India's Ministry of Information and Broadcasting has been promising a National AVGC-XR Policy for years; it's still described as coming "soon," now targeting a $20 billion AVGC-XR market and 2.5 lakh (250,000) skilled jobs by 2030, with a Production-Linked Incentive-style scheme for media and entertainment as its centerpiece. Budget 2026 got ahead of it anyway, setting aside ₹250 crore for "Creator Labs" in 15,000 secondary schools and 500 colleges. While Delhi finalizes the national framework, the states haven't waited: 13 states, including Tamil Nadu, Haryana, Gujarat, Punjab, Odisha, and Delhi, are in advanced stages of their own AVGC-XR policies, many already cabinet-approved.

• Maharashtra, already the sector leader with more than 295 studios (about 30% of India's total), approved a ₹3,268 crore policy targeting ₹50,000 crore in investment and 2 lakh jobs over the next two decades, plus dedicated AVGC-XR Parks in Mumbai's Film City, Navi Mumbai, Pune, Nashik, and Nagpur.
• Tamil Nadu formally notified its own AVGC-XR Policy on March 12, 2026: 200-plus startups and 2 lakh jobs targeted by 2030, a ₹50 crore Centre of Excellence in Chennai with zonal sub-centres planned for Coimbatore, Trichy, Madurai, Salem, and Tirunelveli, ₹250 crore in R&D funding, and startup grants of up to ₹1 crore.
• Haryana launched its AVGC-XR policy on June 1, 2026 as part of a broader industrial push that drew over ₹1.10 lakh crore in investment MoUs; within days, Gurugram-based HKI Media announced plans for a ₹10 crore AVGC-XR Centre of Excellence in response.

Where Indian Studios and Japanese IP Holders Are Actually Finding Each Other

Away from the policy documents, the actual dealmaking Part 1 flagged as thin is starting to show up in specific, named projects. Kerala-based Toonz Media Group, with 25 years in animation production, and Japan's 1st PLACE formalized a cross-border production alliance built explicitly to help anime reach the market faster while Japan's own pipeline stays strained by a domestic talent shortage: Toonz now handles 2D and CG animation work on 1st PLACE productions, including anime tied to live music performances.

The more striking example landed at Anime India Mumbai 2026 (August 28-30), where Geek Pictures India — an Indo-Japanese media and entertainment company — unveiled Panchsheela, an original magical-girl anime built around five Indian schoolgirls, each embodying a sacred chakra, who become supernatural warriors after an ancient darkness breaks free. Geek Pictures co-founder Arjun Aggarwal has described it as deliberately built around heroines who feel distinctly Indian, paired with Japanese character-driven animation craft; no release date or platform has been announced yet. The same convention weekend drew Naruto director Hayato Date and roughly 50,000 fans, and ran alongside the Animation & More Summit, whose "Inside Animation: India x Japan" producer panel put Avex Animation Labels' Tomohiko Iwase, Hiroko Nishi, and Rika Cho on stage with India's 88 Pictures and Powerkids Entertainment — under the explicit banner "India to the World: Creating Global IPs for the Next Generation."

Two Tracks, Still Running Mostly in Parallel

What's notable is how separate these two stories still are. None of the new state money — Maharashtra's parks, Tamil Nadu's Chennai centre, Haryana's incentives — is earmarked for India-Japan work specifically; it's aimed at building generic domestic capacity and homegrown IP, with Japan as one possible buyer or partner among many. Toonz-1st PLACE and Panchsheela, in turn, are private, company-to-company bets that came together on their own timeline, not as a product of any of this policy activity. The state governments are building supply-side capacity; a handful of studios are building the actual India-Japan relationships on top of it. So far, there's not much visible connective tissue between the two.

What's Missing

The clearest gap is a formal one. India has signed Audio-Visual Co-Production Treaties with more than 15 countries, including China, Australia, Canada, and, as recently as 2024, Colombia — agreements that let officially co-produced films and animation draw on both countries' incentive schemes and count as domestic content for local quotas and tax purposes. Japan is not among them. The 2013 MOU that Part 1 covered set up a joint working group, not a treaty with that kind of machinery, and more than a decade later that gap hasn't closed. Without it, deals like Toonz-1st PLACE and Panchsheela happen entirely on private commercial terms, unable to draw on the incentive structures an India-Japan co-production would get almost anywhere else India has this kind of agreement. That's a fairly specific, fixable gap — and exactly the kind of thing worth tracking, and worth connecting people around, at the community level while it remains open.

If you work in animation, gaming, or content production in India or Japan and want to compare notes on where the state incentives and the studio deals actually meet — get in touch. This is exactly the kind of introduction India Japan Kaizen wants to help make.

This is Part 2 of India Japan Kaizen's Pop Culture Bridge Series. Part 3 will follow Panchsheela and the Toonz-1st PLACE alliance as their first output reaches audiences, and check whether an India-Japan audio-visual co-production treaty is anywhere close to the table.