http://www.opticaldisc-systems.com/dvd/overview.htm
Bollywood Failures
In the failure of the Indian film industry to develop DVD content to its quality specifications has resulted in the slow growth of DVD in India. Consequently the VCD format has remained strong. Better quality can only mean better price. In India bad quality DVDs are being marketed at much higher prices.

The film industry with its egoistical divisive and myopic leadership without initiative and planning and without any sense or purpose has remained completely unmoved and without reaction to the terrible loss of the DVD market in India.

Hollywood had planned and promoted the DVD launch to perfection and thus earned billions of dollars in revenue. The Indian film industry is still extremely backward. The present scenario for recorded movie media is such that till DVD prices don’t go down, VCD will continue to pose strong competition to DVD in India.

DVD Authoring
There are strengths in India. The pre-authoring studios are world-class. There are 15-20 DVD authoring studios and many more are coming up. As an overview of the market indicates, the demand for DVD authoring is more than the present studios can fulfil. The quality of graphics and animation available in India is world-class. However actual DVD creation is disappointing.

They got that right!

Ali

This issue frustrates me to no end. There are some great, rare titles only available on VCD. What's more, I don't see much of a price difference between VCDs and DVDs in India (as listed by online retailers)--they are both damn cheap, by US standards ofcourse.