New Delhi: In a landmark recognition of creativity as a powerful economic driver, Finance Minister Nirmala Sitharaman highlighted the Orange Economy during her presentation of the Union Budget 2026-27 on February 1, 2026. This focus underscores the government’s commitment to harnessing India’s vast cultural and intellectual capital for job creation, innovation, exports, and enhanced global soft power. The announcements center on bolstering the Animation, Visual Effects, Gaming, and Comics (AVGC) sector, alongside broader measures to strengthen design education and the overall creative ecosystem.
The term Orange Economy gained prominence in the budget speech and related discussions, marking a strategic shift where creative industries are no longer viewed merely as entertainment but as integral to India’s services-led growth model. This approach aligns with Prime Minister Narendra Modi’s vision of positioning India as a global leader in creative content through platforms like WAVES.
Understanding the Orange Economy: Origins and Scope
The Orange Economy, also widely referred to as the creative economy, encompasses knowledge-based economic activities where value primarily stems from ideas, artistic expression, cultural content, and intellectual property rather than physical production or raw materials. The concept was popularized by former Colombian President Iván Duque Márquez and Felipe Buitrago in their 2013 book titled “The Orange Economy: An Infinite Opportunity”. The name draws from orange as a color symbolizing culture, creativity, and identity.
This sector includes a diverse range of industries such as audiovisual media (including film and television), live entertainment (like music concerts and theatre), gaming, animation, design, advertising, fashion, publishing, digital content creation, and related fields. Unlike traditional manufacturing-driven economies, the Orange Economy thrives on transforming intellectual capital into cultural goods and services that generate substantial revenue through innovation, digital platforms, and global demand.
Globally, the creative economy generates over $2 trillion in annual revenue and supports nearly 50 million jobs, according to various estimates. UNCTAD data indicates that creative industries contribute between 0.5% and over 7% of GDP across different countries, highlighting their significant economic multiplier effect.
In India, the creative sector is rapidly expanding, driven by rising incomes, widespread internet penetration, OTT platform growth, and AI-powered innovations. The country’s media and entertainment (M&E) sector, a core component of the Orange Economy, reached an estimated ₹2.5 trillion in 2024. This growth reflects a strong shift toward digital and platform-based delivery, reshaping revenue streams, employment patterns, and value chains.
India’s overall creative industry is valued at approximately $30 billion, employing around 8% of the working population. The Economic Survey 2025-26 positioned the Orange Economy as an emerging pillar of the services economy, capable of absorbing a large workforce that may not be fully catered to by conventional manufacturing.
Key Budget Announcements Targeting the Orange Economy
Finance Minister Nirmala Sitharaman made several targeted announcements to accelerate the Orange Economy’s development. A flagship initiative focuses on the fast-growing AVGC sector, which is projected to demand nearly 2 million professionals by 2030 due to its expansion in domestic and international markets.
To address this talent gap, the budget proposes support for the Indian Institute of Creative Technologies (IICT), Mumbai. This premier institution, modeled after IITs and IIMs, will lead the establishment of AVGC Content Creator Labs in 15,000 secondary schools and 500 colleges nationwide. These labs aim to provide hands-on training in animation, visual effects, gaming, comics, and content creation, unlocking new career pathways for young Indians, particularly in rural and semi-urban areas.
Union Minister for Information & Broadcasting Ashwini Vaishnaw elaborated on this during a post-budget media briefing at Rail Bhawan. He described the budget as “duty-driven” and inspired by the power of Yuva Shakti (youth power) and Nari Shakti (women’s strength). Vaishnaw emphasized that Prime Minister Narendra Modi has elevated India’s creative economy globally through initiatives like WAVES. He noted that the IICT Mumbai will connect with the specified schools and colleges via these Creators’ Labs, with the potential to generate 20 lakh new jobs in the sector.
In addition to AVGC-focused measures, the budget includes strengthening design education by establishing a new National Institute of Design (NID) in the eastern region via the challenge route. India currently has seven NIDs, all designated as institutes of national importance, and this expansion addresses regional imbalances and the growing need for skilled designers.
The Economic Survey 2025-26 further reinforced these priorities by identifying the Orange Economy as a key driver for employment, urban services, and tourism. It spotlighted the live entertainment or concert economy as a high-multiplier activity, with India’s live entertainment industry surpassing ₹10,000 crore in 2024. This segment creates ripple effects in hospitality, transportation, logistics, and local services.
Globally, examples like the U.S. live music industry, which supported over 900,000 jobs and generated more than $130 billion in 2019, illustrate the potential. In India, structural challenges such as regulatory complexities, infrastructure shortages, and operational constraints persist, but the survey advocates viewing creative industries as part of an integrated strategy for urban growth and tourism.
Recommendations to Accelerate Orange Economy Growth
To fully capitalize on this momentum, the Economic Survey suggested practical steps:
- Implementing a single-window mechanism for simplified permissions in live entertainment events to reduce bureaucratic hurdles.
- Enhancing infrastructure access by opening select heritage monuments for cultural events, boosting India’s appeal as a global cultural destination.
- Prioritizing skill development to bridge the shortage of trained professionals in design, animation, and other creative fields, ensuring the sector can scale sustainably.
These measures aim to shift perceptions from seeing creative industries as “niche entertainment” to recognizing them as strategic assets for inclusive development, innovation, and export growth.
Broader Implications for India’s Youth and Economy
The budget’s emphasis on the Orange Economy aligns with empowering Yuva Shakti by democratizing access to creative tools and training. By integrating AVGC labs into mainstream education, the government seeks to transform hobbies like gaming, animation, and digital storytelling into viable, high-paying careers. This initiative is expected to benefit millions of young Indians, including women, by fostering inclusive opportunities in a sector fueled by technology and imagination.
As India advances toward becoming a developed nation, the Orange Economy represents a unique blend of cultural heritage and modern innovation. With targeted investments in institutions like IICT Mumbai, expanded design education, and ecosystem support, the Union Budget 2026-27 lays a strong foundation for creativity to drive sustainable economic progress, job creation, and India’s rising stature on the global stage.
FAQs
1. What is the Orange Economy, and why was it mentioned in the Union Budget 2026-27?
The Orange Economy (also called the creative economy) refers to economic activities driven by creativity, culture, ideas, knowledge, artistic expression, and intellectual property rather than physical goods or traditional manufacturing. Value in this sector comes primarily from transforming ideas into cultural goods and services, such as films, television, music, live concerts, gaming, animation, design, advertising, publishing, digital content, and theatre. The term was popularized by former Colombian President Iván Duque Márquez and Felipe Buitrago in their 2013 book The Orange Economy: An Infinite Opportunity, where “orange” symbolizes culture, creativity, and identity.
In the Union Budget 2026-27, Finance Minister Nirmala Sitharaman spotlighted the Orange Economy as a major pillar for employment generation, innovation, exports, urban development, tourism, and India’s global soft power. The Economic Survey 2025-26 described it as an emerging driver in India’s services-led growth model, capable of absorbing large-scale workforce talent that manufacturing alone may not fully support. Globally, creative industries generate over $2 trillion annually and nearly 50 million jobs, contributing 0.5% to over 7% of GDP in various countries. In India, the creative sector is valued at around $30 billion, employing about 8% of the working population, with the broader media and entertainment industry reaching ₹2.5 trillion in 2024 due to digital platforms, OTT growth, internet penetration, rising incomes, and AI innovations.
2. What are the main AVGC sector announcements in Budget 2026-27, and how do they aim to support the Orange Economy?
The Animation, Visual Effects, Gaming, and Comics (AVGC) sector was a key focus, as it is one of the fastest-growing parts of the Orange Economy. The Finance Minister noted that this industry is projected to require nearly 2 million professionals by 2030 to meet domestic and global demand.
To build this talent pipeline, the government proposed support for the Indian Institute of Creative Technologies (IICT), Mumbai — an institution modeled on the lines of IITs and IIMs — to establish AVGC Content Creator Labs (also called Creators’ Labs) in 15,000 secondary schools and 500 colleges across India. These labs will provide hands-on training in animation, VFX, gaming, comics, digital content creation, and related skills, making creative careers more accessible, especially for youth in non-metro areas. Union Minister Ashwini Vaishnaw highlighted that this initiative could create up to 20 lakh new jobs, aligning with the budget’s emphasis on empowering Yuva Shakti (youth power) and Nari Shakti (women’s strength). The move democratizes access to creative tools, turning hobbies into professional opportunities and strengthening India’s position in global content production.
3. How does the live entertainment or concert economy fit into the Orange Economy push in Budget 2026?
The Economic Survey 2025-26 identified live entertainment (including music concerts and events) as a high-multiplier segment within the Orange Economy, generating significant downstream economic activity in hospitality, transport, logistics, tourism, and local services. India’s live entertainment industry crossed ₹10,000 crore in 2024, reflecting growth from rising discretionary incomes and a young population.
Globally, examples like the U.S. live music sector (supporting over 900,000 jobs and generating more than $130 billion in 2019) show its potential. The survey noted structural challenges such as regulatory complexity, infrastructure shortages, and operational hurdles but recommended treating creative industries as part of an integrated urban growth and tourism strategy rather than niche entertainment. Suggested reforms include a single-window mechanism for event permissions and opening select heritage monuments for cultural events to boost India’s appeal as a global destination.
4. What other creative education and infrastructure measures were announced for the Orange Economy?
Beyond AVGC labs, the budget announced the establishment of a new National Institute of Design (NID) in the eastern region through the challenge route to address regional gaps and the shortage of trained designers. India already has seven NIDs recognized as institutes of national importance.
These steps aim to strengthen design education and overall skill development in creative fields. The Economic Survey emphasized addressing the lack of trained professionals through targeted programs, viewing skill-building as essential for scaling the sector sustainably. Together, these initiatives position creativity as a core economic strategy, supported by institutions like IICT Mumbai and expanded design education.
5. What challenges does the Orange Economy face in India, and how does the budget address them?
Despite strong growth, the sector faces hurdles like regulatory complexities (especially for live events), infrastructure shortages, operational constraints, and a shortage of skilled talent. The budget tackles these through large-scale skilling via AVGC labs, institutional support for IICT Mumbai, and a new NID to build design expertise.
The focus shifts perception from “niche entertainment” to a strategic driver of jobs, exports, and soft power. By investing in education-to-employment pathways, the government aims to create future-ready opportunities, reduce talent gaps, and enable India to compete globally in creative content and IP-driven industries. This duty-driven approach, inspired by youth and women empowerment, aligns with Prime Minister Narendra Modi’s vision showcased at events like the WAVES summit.
