How Tamil Nadu is Gaming Its Way Into an AVGC-XR Future

Tamil Nadu is attempting something unique: converting its deep cultural legacy in cinema, music and visual arts into a modern, export-oriented digital economy anchored in animation, visual effects, gaming, comics, and extended reality (AVGC-XR).

That effort is now moving from intent to infrastructure, with policy, funding, industry events and physical institutions aligned around a single objective: positioning the state as a national hub for AVGC-XR.

Last year, the Electronics Corporation of Tamil Nadu (ELCOT) floated a tender for the development, operation and management of the proposed Viyan AVGC-XR Centre of Excellence (CoE) in Chennai. The centre is designed to foster innovation, content creation, and advanced skill development in emerging digital media sectors.

In its initial phase, the Viyan CoE is envisaged to operate out of a 12,000–15,000 sq ft leased facility in Chennai, offering co-working spaces and dedicated private offices for startups and MSMEs. The facility will house specialised studios for performance capture, 2D and 3D art creation, audio and foley services, and XR testing, alongside shared infrastructure to lower entry barriers for early-stage studios.

The second phase significantly expands this vision. The centre is planned to grow into a one lakh sq ft facility in Chennai, with larger co-working capacity, advanced production and testing studios, screening halls, event spaces, and high-tech labs for hardware rentals and digital content prototyping.

Beyond its capital, Tamil Nadu plans to extend this infrastructure to Coimbatore, Madurai, Tiruchirappalli, Salem, and Tirunelveli. These hubs are intended to function as regional innovation centres, providing access to infrastructure, training and networking opportunities for local startups and MSMEs.

The physical infrastructure is backed by a broader policy and ecosystem narrative. Speaking at UmagineTN, Palanivel Thiaga Rajan, minister for information technology and digital services, framed AVGC as a strategic cultural and economic pivot for the state.

“This year’s focus is also on the creative arts,” he said, adding that Tamil Nadu’s “unique cinematographic and music industry” provided a natural foundation to build on.

He pointed to the state’s ongoing work on an AVGC policy, funding support for a CoE, and its partnership with the Game Developers Association of India (GDAI), which helped bring the India Game Developers Conference (IGDC) to Chennai for its 17th edition.

IGDC has historically been held in cities such as Pune and Hyderabad, according to GDAI.

In November, the conference was hosted in Chennai for the first time. Speaking to AIM, Sridhar Muppidi, chairperson of the GDAI, said Tamil Nadu was gaining significant traction in AGVC, driven in part by its strong creative legacy.

He observed that talent availability had historically been a constraint, but that is now beginning to change. With continued investment, incubation programmes and support for large-scale industry events, he said Tamil Nadu could quickly emerge as a leader, ranking alongside Maharashtra, Telangana, and Karnataka.

On the policy front, Muppidi said Tamil Nadu has not yet formally announced its AVGC policy, but discussions around its contours have been encouraging. “We’ve heard some of the elements that are likely to be included, and they seem very promising,” he said.

He cautioned against framing the sector purely in terms of inter-state competition. “We are not competing with each other; we are competing globally,” he said, noting that India currently accounts for only about 1% of the global gaming market. 

“The market is so large that even states with a head start have not captured it in any significant way.”

The real objective, he said, should be to build a globally competitive export industry. On measuring success, he said output alone was insufficient. “Gaming can create a lot of self-employed entrepreneurs,” he said. The more meaningful metric, he added, was the number of sustainable studios created.

By industry estimates, he said, India currently has just over 600 established gaming studios. “Over the next 10 years, that number should grow to at least 5,000 across the country,” Muppidi said, adding that Tamil Nadu aims to capture at least 10% of that growth.

“In the next five years, can we see 500 studios being formed in Tamil Nadu? That depends on how quickly we can build talent, education and skills.”

A Promising Future

Industry voices at UmagineTN broadly welcomed the state’s direction while also flagging gaps that still need to be addressed.

Prashanth Krishnan, co-founder and chief product officer of Chennai-based mobile game developer Highbrow Interactive, noted that, unlike SaaS, where companies such as Freshworks and Zoho have created visible playbooks, gaming in India remains a first-generation industry.

“We are all very first-generation companies who are trying to create that first success and hopefully become the playbook for others to follow,” he said, stressing the need for government support in sensitisation and perception-building, particularly within colleges, to encourage students to consider gaming as a career.

For more mature studios, policy clarity and financial instruments matter as much as infrastructure. Mohan Doss, co-founder and chief executive of Chennai Games Studio, said clearly defined policies would provide much-needed certainty. He called for ecosystem support in the form of grants and funds for quality studios that have demonstrated sustained work over five to ten years, arguing that such backing would materially accelerate growth.

Awareness and early exposure emerged as another recurring theme. 

Karthikeyan Thanigaivel, who heads Nextwave Multimedia, said gaming is still not treated as a serious sector. He argued that awareness must begin at school so students see gaming as a domain where they can “play, enjoy and also survive,” while reaching a global audience.

Access to guidance and global distribution channels is another gap the state’s initiatives aim to address. Mario Royston, co-founder and managing director of gaming company Weloadin Studios, recalled how a lack of mentorship and publisher access led many early indie studios to shut down. He said exposure at platforms such as IGDC plays a crucial role in helping studios connect with global platform editors and publishers.

Alongside AVGC, Tamil Nadu is sharpening its focus on extended reality as a distinct strategic pillar. 

M Manivannan, a professor at IIT Madras, said the state “has a huge opportunity to lead frugal XR in the world,” emphasising the need for targeted policy attention. Frugal XR focuses on making extended reality technologies affordable and accessible to a wider population.

He noted that IIT Madras has already drafted XR policy inputs and submitted them to the state government, hoping that Tamil Nadu would become the first state to announce an exclusive XR policy, alongside the eventual creation of a dedicated institute for XR.

These initiatives should not be looked at in isolation. As early as September 2023, ELCOT convened a state-level stakeholder consultation on the TN AVGC-XR Policy, bringing together industry, academia and government to shape a framework focused on industry development, education and skilling, access to infrastructure and technology, and financial viability.

At UmagineTN 2026, the government also signed multiple MoUs across priority sectors, including AVGC-XR, gaming, visual effects, XR research, and skilling, signalling an effort to translate policy vision into on-ground partnerships.

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