US President Donald Trump may be yet to flesh out the details on his recent declaration that he would levy a 100 per cent tariff on all films made overseas and then sent into the US, but it has kept the Malayalam film industry guessing. The fresh policy announcement from Washington threatens to cast a shadow over the industry’s growing global reach.

In a Truth Social post on September 29, Trump declared that he would levy the tariff “on any and all movies that are made outside of the United States.” Though his post offered no clarity on the timeline or implementation, the move is unprecedented, targeting a service rather than a product.

Trump had first floated the idea in May, arguing that many Hollywood productions had shifted overseas to exploit tax benefits in countries such as Canada, Spain, and South Korea. He claimed that California, the traditional hub of American filmmaking, had been “particularly hard hit.”

Industry leaders in India have responded with caution. Shibasish Sarkar, President of the Producers Guild of India, told ANI that Trump’s comments appeared aimed primarily at Hollywood films shot abroad rather than at foreign-language productions. However, he admitted that the long-term effects on Indian cinema remained uncertain.

For Malayalam cinema, which has grown into a powerful global force post-pandemic, the concern is more tangible. George Koshy, Co-founder and CEO of Infamous Coconuts, a production company based out of LA and New York, said such a tariff could disrupt the industry’s stronghold in the US.

“Post-COVID, Malayalam cinema has seen tremendous growth, particularly among the Indian diaspora in the US,” Koshy said. “Around 40 to 60 per cent of overseas revenues for Malayalam films come from the American market, especially the East Coast, where the Malayali population is concentrated.”

He warned that a steep tariff might make it harder for smaller Malayalam films to reach theatres abroad. “Distributors may need to absorb the extra cost or raise ticket prices. Eventually, audiences might shift to OTT platforms instead of cinemas,” he added. Koshy also noted that defining a film’s origin in today’s global production environment is complicated. “A Malayalam movie might have scenes shot in Los Angeles, sound design in Toronto, and colour correction in Kochi. How do you define where it truly belongs?”

Film Producer M Renjith echoed the concern but expressed confidence in the industry’s resilience. “Right now, after the release of Empuraan, Thudarum, and Lokah, the demand for Malayalam movies is only increasing,” he said. “Viewer numbers in the US may not drop because most audiences can afford the hike. But smaller and mid-budget films could be hit harder than big productions.”

Renjith added that a clear picture would emerge once the tariff is implemented. “This won’t affect Malayalam cinema entirely. We still have other major markets like the UK and Dubai. From 2025 onwards, Malayalam cinema has shown remarkable growth. So far, there’s been no industry-level discussion about this issue. This is essentially a matter between two countries,” he said.

Malayalam filmmakers have long found creative ways to produce world-class content without overspending. The recent blockbuster ‘Lokah’, for instance, recreated an elaborate Bengaluru set in Chalakudy, Kerala — a testament to how the industry continues to innovate, delivering top-notch cinematic experiences while keeping production costs in check and breaking both barriers and borders.

Industry persons associated with distribution and exhibition said that there is so much to be explained about the declaration. “There are so many components in film production, how exactly do you define where a film is made?. These days, shoots are done in multiple countries and post-production is done elsewhere,” an industry source said.