By Darryl Chamberlain
Entertainment reporter, BBC News
Barbara Follett joined Ajay Devgan (left) and Vipul Shah in central London
A deal to help Bollywood producers to work in the UK will help the British movie industry withstand the economic downturn, the film minister has said.
Barbara Follett said the UK industry offered "an excellent product" and the deal would help "maintain excellence".
"The wider your base, in an economically difficult time, the more resilient you'll be," she added.
She spoke alongside director Vipul Shah, who has taken over Trafalgar Square to make new film London Dreams.
Its stars, Ajay Devhan and Asin, were also at the launch of the agreement, which has now come into force.
The treaty means Indian film-makers will find it easier to obtain tax relief if they collaborate with British producers.
It will also help them to obtain funding from sources such as the National Lottery, Ms Follett said, and help to cut down on the bureaucracy involved in making films.
Civil servants from India and the UK have been working on the treaty for the past three years.
Vipul Shah, whose previous film Singh is Kinng was a huge worldwide hit, backed the deal.
Ajay Devgan said global demand was changing Bollywood films
"I think that more films will be made in London, primarily for Indian markets," he said.
"Working with crews in their own cities is a great thing. They know the systems, how the shoots function in that particular city, how to get permissions, how to move things. It's always very important."
Shah has previously made Namastey London in the British capital, and said he hoped to make a third film there.
"It's an added bonus to us when we work with a local crew. I've loved every minute here. Hopefully when I come for the third film, I'll be using some crew from London."
Up to 10 films could go into production in the next two years as part of the deal.
The deal comes as Bollywood films become more popular around the world, and Mumbai-based film-makers broaden their sights beyond India.
Actor Ajay Devgan said the demands of a global market were having an effect on Indian films.
"I guess they are changing to adapt to the audience. We're just trying to cater for them," he said.
"All kinds of films are being made - there are films that have been adapted for the global market and are doing very well."
Shah added he had "loved every minute" of working in London.
"Yesterday I had a special permission to shoot something in Trafalgar Square from a helicopter," he said.
"I've seen London from a chopper before, but not so low down and not flying from Big Ben and St Paul's Cathedral and Trafalgar Square. That was pretty special - very, very exciting."