When I asked the concierge for a taxi to go interview film director Subhash Ghai at his studio in Mumbai, he sized me up with new respect and summoned a Mercedes instead of the usual Fiat. "Mr. Ghai is the greatest showman in Bollywood," he says. "And he is clean!" This was not a reference to hygiene; India\u2019s $1.3 billion movie industry is notoriously riddled with mob interests.But with Mukta Arts, India\u2019s first publicly held movie production studio, Ghai is aiming for corporate respectability. He hopes to capitalize on what many see as India\u2019s almost unlimited potential to provide competitively priced, quality content, animation and special effects for the IT-driven entertainment world. "No one could miss the importance of content in the America- Online-Time-Warner deal," he told me. "This is where IT meets the movies."Last year, for the first time, the Indian government\u2014anticipating software and content opportunities in the convergence of the Internet, communications and entertainment industries\u2014the "ice age," Indians call it\u2014recognized the movie business as a legitimate industry, qualifying the studios for bank loans and tax breaks. Since April, videos, like computer software, are exempt from export taxes.India is already the globe\u2019s largest producer of films, annually cranking out some 800 titles. Exports earned $100 million last year, a tenfold increase since 1990. This year\u2019s earnings are estimated at $250 million. Management consultant Arthur Andersen predicts Indian exports will expand by at least 50 percent each year, earning around $3 billion by 2006. India\u2019s IT software and engineering savvy is spilling into India\u2019s fast-growing reputation as an outsourcing center for high-quality, low-cost animation and special effects. (Indian companies typically charge 75 percent less than U.S. companies.) India\u2019s Pentamedia Graphics did the 3-D animation for the U.S. film Sinbad and will do the same for Ali Baba and the Forty Thieves. The company also has deals in France and Japan. Arthur Andersen forecasts that Indian animation exports alone will reach $2 billion in 2003. The evening we talked, Ghai was working late in a recording studio dubbing a film score. The equipment was impressive\u2014the Fairlight MFX-3 Plus-equipped digital audio workstation is the first of its kind in India. But the building had no air conditioning and was located at the end of a rutted, unpaved road. Mopping sweat from his brow, 57-year-old Ghai took a break and described his plans to expand his setup at nearby Filmcity (a Bollywood production center) into a Hollywood-style studio with state-of-the-art production and post-production facilities for features, advertising, TV films and serials. Some 2.3 million Indians work in the movie business, including technicians, engineers and animators. Employment is expected to grow 70 percent in the next five years.Ghai is also building a software library with the purchase of video, cable and satellite rights to a dozen movies. "We expect the Internet to come through TV in India," he says. "And the domestic demand for content\u2014films, serials, interactive programming\u2014will be enormous." An astute businessman with an eye on popular taste, Ghai winced when I referred to Bombay\u2019s movie industry as Bollywood. "The BBC invented the term about 10 years ago, as if we were aping Hollywood," he says. "It is scoffing, somehow demeaning. You\u2019ve seen what India has done with IT. We\u2019ll make the same leap with Indian cinema. Our boys are very interested in webcast, interactive TV, animation."Of Ghai\u2019s 14 films, the most successful was the blockbuster musical Taal ("Rhythm"), starring a former Miss World. The story: A billionaire\u2019s son falls for a plucky village girl who sings her way to the top of the pop charts. In one of the strongest debuts ever for a Hindi film in the United States, Taal grossed $788,000 from 44 venues the weekend it opened in 1999 and was ranked 20th on Variety\u2019s box office charts. The record for Indian exports is Kuch Kuch Hota Hai ("Something Happens"), which has earned $23 million since 1998. They Are the World Across Asia, the Middle East, Africa, Japan, the United States, Fiji and even in Russia, Indian movies have become a potent box office draw. The growth in exports is partly fueled by India\u2019s diaspora. Some 20 million Indians live abroad. United States-based Indians take their kids to Indian movies to reinforce cultural values. Weak on plot, the movies promote respect for seniors and the benefits of arranged marriages. Two satellite channels based in England and the Arab Gulf\u2014Eros International and B4U (Bollywood For You)\u2014offer nothing but Indian movies."Cinema in India is largely escapism," says Pritish Nandy, a writer, TV producer and media personality who is also a member of India\u2019s parliament. "It is all about what you want life to be\u2014candy floss, larger-than-life heroes, gorgeous heroines. It is not about real people, real things, but that is India."A Fistful of RupeesWith new funding opportunities, such as the stock market, Ghai believes the industry will overcome its gangster rep. Since going public in July, his Mukta Arts studio has listed at a premium on both the Bombay and National Stock exchanges. "Mukta got the response it did in the capital markets because we\u2019ve had a clean record for 21 years," he says.Still, the work is hazardous. Extortion plots are so common that top directors employ bodyguards. Last year one of India\u2019s major film producers, Raksh Roshan, was shot and wounded outside his Mumbai office after refusing to give a gangster overseas distribution rights. At least two other producers have been murdered since 1997, and many more have survived attacks. For Indians deeply preoccupied with movie culture, the kidnapping in July of film icon Rajkumar, a star of more than 200 movies, was shattering. The 72-year-old actor\u2014India\u2019s answer to John Wayne\u2014was watching TV with his wife and valet at his remote farm, 140 miles south of India\u2019s high-tech capital, Bangalore, when the notorious jungle bandit Koose Muniswamy Veerappan and a dozen men in combat fatigues burst into Rajkumar\u2019s living room brandishing AK-47s and whisked the actor off to a forest hideaway. Veerappan, who has eluded authorities for 15 years and twice escaped captivity, is India\u2019s most wanted outlaw. In early October, as Veerappan\u2019s demand for the release of 51 jailed allies was still unmet (India\u2019s Supreme Court barred their release), the actor\u2019s whereabouts and fate were still unknown. And the best source of information about the case was, naturally, the Internet.