Kerala's AVGC-XR centre takes 20 acres in Thiruvananthapuram under C-DIT, and its production grants are written for companies registered with it

The Government of Kerala will set up a Centre of Excellence in AVGC-XR as the cornerstone of the state's ecosystem, identify 20 acres of land in Thiruvananthapuram to locate it, and make the Centre for Development of Imaging Technology the nodal agency responsible for setting it up and for implementing the policy ^[2].

On 30 September the Indian Institute of Creative Technologies signed a memorandum of understanding with C-DIT at FICCI FRAMES 2026 to support the proposed Kerala State Centre of Excellence for AVGC-XR in Thiruvananthapuram, covering curriculum development, faculty training, studio internships, startup incubation, technology support and international industry connections, ANI reported ^[11].

The centre is to provide digital post-production labs, motion capture, 2D and 3D animation and high-speed rendering, and to administer specialised and doctoral programmes, with its courses and research affiliated to the Kerala University of Digital Sciences, Innovation and Technology ^[3].

The production grants for animated episodic series, animated feature films, XR and VFX projects and game development are each addressed to companies registered with the centre ^[13]. An animated episodic series of 13 episodes or more made for television, VOD or SVOD draws reimbursement of 20 per cent of qualified expenditure, capped at INR 30 lakh for one company in a year across two sanctions, with a single sanction capped at INR 20 lakh, and the clause is written for companies registered with the centre ^[6].

XR and VFX work for domestic productions on contracts above INR 15 lakh draws the same 20 per cent, capped at INR 20 lakh for one company in a year across three sanctions, with a single sanction capped at INR 10 lakh, on the same registration condition ^[7].

Animation films of 90 minutes and above are capped at INR 1 crore per film and one sanction a company a year, also for companies registered with the centre, and the clause as published states no reimbursement percentage where the episodic and VFX clauses both state 20 per cent of qualified expenditure ^[8].

The Product Development Grant carries no registration condition ^[13]. It pays INR 15 lakh at the idea-to-development stage and INR 5 lakh at pitching, one grant a company a year to a maximum of five across the policy period ^[9].

The targets the centre is meant to serve are 250 AVGC-XR companies including MNCs by 2029, 50,000 new jobs by 2029, 150 startups incubated in Kerala by 2029, 10 per cent of India's AVGC-XR export revenues by 2029, 10,000 professionals qualified for the industry year-on-year, and at least 15 per cent of the AVGC-XR content created in the country ^[5].

The policy also proposes an AVGC-XR Catalyst Fund of INR 200 crore over five years, with the Government of India, the Government of Kerala, banks, private equity funds and high-net-worth individuals as partners, 30 per cent of it to be used as a seed fund and 70 per cent as a scale-up fund ^[10].

What the policy does not settle is the centre itself: capital expenses are to be met by the Government of Kerala along with grants from the Government of India and contributions from industry, and the working model of the centre is to be defined at a later stage by the state's Department of Electronics and Information Technology ^[4].

The centre the September memorandum supports is described in ANI's report as proposed ^[11].

IICT brings a year of operating to the arrangement: as of 11 March 2026 it had enrolled 136 students across 18 distinct courses, had put 15 participants through a Train-the-Trainer initiative, and was supporting 11 startups through its incubation programme ^[12].