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Bill Radke: At the Academy Awards on Sunday, the movie "Avatar" will be up for nine Oscars, including Best Picture. Some of the credit for that film's success goes to India. Raymond Thibodeaux reports from New Delhi the Avatar connection is another sign that India is outgrowing its image as the call center for the world's IT industry.

Raymond Thibodeux: In this scene from the movie "Avatar," the main character, Jake Sully, enters the lab where the avatars are made. And much of that lab is computer-generated by a company with deeper roots in Bollywood than Hollywood:

Namit Malhotra (voice of interpreter): We did almost 200 visual effects shots, which included all the lab sequences.

Namit Malhotra is founder and CEO of Prime Focus, the India-based company that also created much of the movie's command center and helicopters.

Malhotra (voice of interpreter): Being one of the frontrunners from India, obviously it's a feeling of pride for us. India is ready for the big game.

Having an on-screen role in such a big movie confirms that Hollywood isn't just outsourcing the drudge work of the visual effects trade to Indian companies.

Som Mittal is president of India's biggest IT and outsourcing industry association. He says the world woke up to India's IT and software industry in 1999. Then, stressed Western companies used Indian technicians to address glitches they feared would arise in computer systems as the new century dawned.

Som Mittal: Well you know when you go back to Y2K, I think it gave visibility to what could be done. It was really about how you can do certain things in a compressed time, and meet a deadline.

Mittal says since then, Indian software technicians have matured. Animators have come of age and are better able to compete in global, cutting-edge markets.

Mittal: If you look at what's happening in animation here, it's about confluence of technology and creativity. So I think that's the change in every sphere that we are seeing in the IT sector.

The animation and visual effects industry is a tiny part of India's IT sector. But it's one of the fastest-growing, and it's aiming for even bigger Hollywood roles. The U.S. movie "Clash of the Titans" is being converted to 3-D. The Indian company Prime Focus is doing the conversion.

In New Delhi, I'm Raymond Thibodeaux for Marketplace.