The orange economy—encompassing cultural and creative industries such as arts, film, music, gaming, fashion, and design—generates value primarily through human talent, creativity, and intellectual property. According to World Bank studies, it contributes $2.3 trillion annually to global revenues, equivalent to 3 per cent of world GDP, while sustaining 30 million jobs.
This sector holds particular importance for youth, women, and informal workers. In nations like Ghana and Uganda, it accounts for over 25 per cent of youth employment. In more than half of the 35 low- and middle-income countries surveyed, it employs more women than men. Its resilience is notable: during the 2009 financial crisis, creative trade declined by only 12 per cent, far less than the 40 per cent drop in oil trade. Beyond stability, the orange economy promotes economic diversification, social inclusion, and digital transformation, with global creative goods trade doubling to $509 billion by 2015.
India’s Union Budget 2026-27 explicitly recognises this potential, positioning the orange economy as a key driver of youth employment. Finance Minister Nirmala Sitharaman announced the establishment of AVGC (Animation, Visual Effects, Gaming, Comics) Content Creator Labs via the Indian Institute of Creative Technologies. These labs will roll out in 15,000 secondary schools and 500 higher education institutions, with a target of skilling 2 million professionals by 2030.
Complementing this, a new National Institute of Design in eastern India—selected through a competitive challenge mode—will address regional skill disparities. These initiatives align with the Economic Survey 2025-26, which advocates harnessing creativity to generate jobs, enhance urban services, boost tourism, and expand intellectual property exports, thereby establishing India as a global creative hub in a rapidly growing sector.
The orange economy’s strategic importance in India is amplified by its direct linkage to the Global Innovation Index (GII), the premier benchmark for national innovation ecosystems. Published annually by the World Intellectual Property Organisation (WIPO) in collaboration with Cornell University and INSEAD, the GII 2025 ranks 139 economies based on over 80 indicators. These are organised into two sub-indices: Innovation Inputs (five pillars that enable innovation) and Innovation Outputs (two pillars that measure results).
The Input pillars—Institutions, Human Capital and Research, Infrastructure, Market Sophistication, and Business Sophistication—lay the groundwork for innovative activity. The Output pillars capture tangible outcomes: Knowledge and Technology Outputs (e.g., patents, scientific publications, high-tech exports) and Creative Outputs.
The Creative Outputs pillar is especially pertinent to the orange economy. It comprises three sub-pillars: Intangible Assets, Creative Goods and Services, and Online Creativity. Intangible Assets measures trademark applications (by origin and Madrid system), global brand value (top brands), industrial design applications (by origin and Hague system), and ICT-driven business and organisational model creation.
These indicators reflect the protection and commercialisation of creative intellectual property, core to sectors like fashion, design, and branding.
Creative Goods and Services tracks exports of creative goods (e.g., audiovisual products, cultural artefacts) and creative services (e.g., audiovisual and related services, cultural exports). This directly quantifies the global trade performance of orange economy outputs, such as films, music, gaming content, and design services.
Online Creativity assesses digital cultural participation through indicators like generic and country-code top-level domains per capita, Wikipedia monthly edits, and mobile app creation. This captures the democratisation of creativity in the digital age, including user-generated content and online gaming ecosystems.
Together, these sub-pillars emphasise artistic production, cultural trade, and intangible value creation—mirroring the essence of orange economy activities in AVGC, film, music, and design.
In GII 2025, India ranked 38th overall, with strengths in Knowledge and Technology Outputs (22nd globally) but room for improvement in infrastructure, business sophistication, and Creative Outputs (42nd).
The Budget 2026-27 measures target these gaps head-on. AVGC labs in educational institutions will build human capital, foster innovation linkages, and generate new intellectual property, directly boosting intangible assets (e.g., trademarks and designs) and creative goods exports. The new design institute will enhance industrial design applications and regional creative clusters—Bengaluru already ranks among the global top innovation hubs. These efforts will accelerate the media and entertainment sector’s growth to a projected $50 billion by 2029, elevating India’s Creative Outputs ranking, improving overall GII performance, and creating inclusive, youth-centric jobs.
In a time of technological disruption and India’s youthful demographic advantage, the orange economy provides a resilient, creative pathway to economic progress. The 2026-27 Budget demonstrates a forward-looking commitment to transforming creative talent into widespread employment and global competitiveness.
The author is a Professor at the National Institute of Public Finance and Policy (NIPFP), New Delhi, and an elected Member of the Governing Board of Management at the International Institute of Public Finance (IIPF) Munich.
The opinions expressed in this article are those of the author and do not purport to reflect the opinions or views of THE WEEK.