For Prelims: Creative economy forms and MSMEs.

For Mains: Impact of MSMEs on the Indian economy, its advantages and disadvantages, and the state of India’s creative economy. 

Why in the news?

India's creative economy, comprising the arts and crafts, audio and video arts, and design, among others, accounted for exports of goods and services worth $121 billion in 2019, according to a paper by the Exim Bank of India.

What do we need to know about the creative economy?

Since there is no agreed-upon definition of the creative economy, it can be difficult to define. Due to its location "at the crossroads of arts, culture, business, and technology," this economic sector blurs the boundaries between various industries.

Careers in photography, graphic design, fashion design, filmmaking, architecture, publishing, video games, and other creative industries are included in the creative economy.

Reasons for the expansion of the creative economy

  • The creative economy is well-positioned to continue expanding steadily even if other economic sectors are having difficulty.
  • Some of this growth can be attributed to the increase in internet usage, making money from more people shopping online, and the relatively easy shipping of innovative products around the globe as a result of technological advancements. 
  • Some people credit the growth of the creative sector to more robust arts programs as governments around the world begin to recognize its value.

The impact of the creative economy

  • The creative economy has much more in store for us than just the latest box office hit or radio hit.
  • The arts make a larger economic contribution to the country than the building, mining, utility, insurance, lodging, and food service sectors.
  • Money isn't everything, though. The creative economy plays a crucial role in maintaining cultural significance both domestically and abroad. 
  • The World Economic Forum claims that creative services could be a catalyst for increasing trust, understanding, and acceptance between cultures. Creative works have a universal appeal.

What are the paper's main conclusions?

  • In 2019, India exported close to $121 billion worth of creative goods and services, with exports of creative services accounting for nearly $100 billion of that total.
  • In India, the design sector contributed 87.5% of all exports of creative goods in 2019, and the art and crafts sector contributed another 9%..
  • Additionally, the creative goods sector in India has a $16 billion trade surplus.
  • In the nation, the creative economy was greatly diversified, and sectors like the entertainment industry helped to propel it forward.
  • Regarding the top international box office markets by revenue outside of the United States, India is ranked sixth overall.
  • In this rapidly changing environment, technology is, according to the study, playing a crucial role alongside human creativity, knowledge, and intellectual property.

What is the significance of the study?

  • The study charts India's creative economy's unrealized export potential.
  • This is the first study of its kind, "Reflection & Development of India's Creative Economy."
  • According to the UN classification, it examined seven different creative industries to map their export potential, including art and crafts, audiovisual production, design, and visual arts.
  • In addition, the study covered how blockchain, extended reality, and artificial intelligence, and machine learning are affecting how the creative economy operates.
  • Additionally, it examines the creative economy policies of nations with specialized ministries or institutions, such as the United Kingdom, Australia, France, South Korea, Indonesia, and Thailand.

How should the creative economy be supported in India moving forward?

  • India's creative economy needs to be supported by:
    • the identification and mapping of India's creative industries.
    • financing for the creative industries.
    • Focusing on joint programmes.
    • Dealing with the subject of copyrights.
    • Encouraging local artisans and Micro, Small, and Medium-Sized Enterprises (MSMEs).
    • setting up hubs and neighborhoods for creativity.
    • Creating an institution with a focus on the creative industries.
  • India has made strides in the creative economy-related industries, but there is still a lot of room for growth in this sector.
  • In addition to having a dedicated institution that could investigate its untapped potential, the country needs to develop a single definition for the creative economy.