The government has constituted a high-powered committee, headed by Planning Commission Member NK Singh, to set new guidelines for regulating film financing.

The committee will also suggest alternative investment options like venture capital funding in the film and entertainment sector.

The other members of the committee are Pawan Chopra, secretary, information and broadcasting ministry; Vinai Rai, additional secretary, banking; S N Menon, special secretary, commerce ministry; and KV Kamath, chief executive officer, ICICI.

The industry representatives, who will be included in the committee, are Shekhar Kapoor, Manmohan Shetty and Sandeep Bedi.

The committee is expected to submit its report within the couple of months. Its recommendations might be included in the Budget for 2004-05, sources said.

"The group is expected to suggest a roadmap to bring in additional funds to the sector and help legitimise film and entertainment financing. The suggestions of the committee may be included in the Budget," sources said.

According to the sources, the committee will also consider various options to streamline film financing and to ensure easy availability of funds for film makers. The government expects the move to hasten the corporatiosation on the film industry.

Financial institutions have, so far, sanctioned about Rs 526 crore (Rs 5.26 billion) to finance films. Of this, the largest contribution of Rs 100 crore (Rs 1 billion) has come from IDBI.

As a part of its steps to promote film making in India, the government has eased procedures and relaxed regulations in connection with script clearances and visa permissions.

According to the guidelines announced earlier, film makers only have to provide details relating to filming, casting and location to the information and broadcasting ministry a month prior to the actual shooting.

The Indian film industry produced 1,013 films in 2001, up from 855 in 2000 -- a growth of 18 per cent in volume terms.

According to industry experts, the industry spent an estimated Rs 2,500 crore (Rs 25 billion) in 2001. This represents a 16 per cent increase over the total costs over 2000.