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A hundred years after India's first movie was shown in a theatre in pre-partition Mumbai, its film industry is still seen as the Bollywood dream factory, churning out boy-meets-girl melodramas adorned with elaborate musical numbers, warring relatives and repressed sexual tensions.

Such an impression overlooks the more serious strand that runs through Indian cinema, producing challenging films in all political shades and languages.

The decades between the 1960s and 1980s may have produced India's most memorable instances of escapism, but they also saw the ascendancy of independent film-makers such as Shyam Benegal, Satyajit Ray and Mahesh Bhatt who examined such divisive issues as caste prejudice and the harassment of women.

Today, India produces around 600 films each year - increasingly tested to cater to the tastes of middle-class locals and foreign emigrants with gym-fit actors, exotic locations and a rampantly consumerist lifestyle. But there exists a more introspective pool of directors within Indian cinema who are auditing the country's internal politics, corruption and social stigmas.

Recently premiered at the Venice Film Festival, director Mira Nair's adaptation of The Reluctant Fundamentalist is one of a number of notable shifts in Indian film. Mohsin Hamid's 2007 novel, an elegant exploration of a young Pakistani man's complicated relationship with the West, treats a subject rarely discussed in Bollywood. In fact, India's tense relationship with its immediate neighbour remains largely absent from cinema screens. Nair's adaptation of Hamid's novel makes novel use of American and Indian acting talent.

The film stars Kiefer Sutherland, Liev Shreiber and Kate Hudson, alongside such sub-continent veterans as Shabana Azmi and Om Puri. British Asian actor Riz Ahmed, who starred in the Chris Morris film Four Lions, plays the lead.

Put alongside her previous releases Monsoon Wedding and The Namesake, dramas anchored in the emotional seas of Indian family life, The Reluctant Fundamentalist is Nair's first crosscultural cast project. Indian films regularly traverse the globe, but whether set in London, Paris or Geneva, their love-struck couples usually interact solely with other Indians.

‘I think it shows how Indian cinema is changing,' says Rajinder Dudrah, the head of drama and senior lecturer in screen studies at the University of Manchester. ‘Nair and her production team are obviously playing to a number of different constituencies. A traditional Bollywood base will appreciate the well known Indians in key roles.

‘The adaptation of a critically acclaimed book will draw viewers aware of its post-9/11 history. The film is playing to both a traditional Bollywood base as well as non-Indian audiences.'

Nair's film isn't the only example of the subtle revolution taking place in Bollywood. Mumbai is witnessing the birth of rival film industries in Calcutta, Chennai and Bangalore. Regional audiences demanding local content have loosened Mumbai's century-old monopoly. Released earlier this summer, Anurag Kashyap's Gangs of Wasseypur, a violent crime saga spanning three generations, proved extraordinarily successful. The film marked a departure from the Bollywood rulebook - Kashyap cast his script with no top-tier names. Gangs of Wasseypur, which had an initial running time of five hours was released in two parts, heavily promoted on social media and premiered at the Cannes Film Festival in May.

Despite these successes, India remains a challenging market, occasionally prone to censorship. An upcoming adaptation of Salman Rushdie's acclaimed love letter to India, Midnight's Children, is unlikely to get a release on the sub-continent, despite roles for a number of well-known Indian actors. Rushdie remains a controversial figure in India - a planned appearance at the Jaipur literary festival was cancelled last January after protests by Indian Muslim groups.

The stark contrast between the competing strands of Indian cinema weren't always so pronounced. Historically, Indian films, in all their populist glory, echoed the tectonic shifts in the world's most populous democracy. In the 1950s, auteurs such as Guru Dutt directed Kaghaz Ke Pool (Paper Flowers) and Pyaasa (Thirsty), films that cast a critical eye on materialism and corruption. In the 1960s and 1970s, Awaara (Tramp) and Sangam (Confluence), both directed by Raj Kapoor, evoked the loss of Indian identity as a consequence of a metropolitan boom. The country's struggle with political decay and police brutality during the rule of Indira Gandhi flashed across cinema screens in Deewar (Wall) and Adalat (Court). As recently as the 1980s, Coolie and Parinda (The Bird) focused on Mumbai's notorious underworld gangs.

In the past two decades, however, India's economic expansion has exerted a powerful influence on cinema. As India has opened its doors to financial trade and outsourcing, the country's middle classes have changed lifestyles. Neglected theatres have been replaced by shining multi-screen cinemas in modern shopping centres. The wealth has also trickled down onto other sectors. According to Euromonitor, outbound tourism has grown by 13 per cent in the past five years.

Indian cinema, echoing this new found adventurism, has taken on a brash confidence. A typical Bollywood film begins in Dubai, pauses for lunch in a London bistro, before uniting the leading man with his paramour on a rooftop bar in Manhattan. Supercars, shopping sprees and the insistent sounds of electronic dance music have replaced traditional themes of family, identity and modesty.

‘Mostly, modern Indian cinema has been trivialized,' says Lalit Mohan Joshi, director of the South Asian Cinema Foundation. ‘Especially since the latter part of the 1990s. Most of the films produced by Bollywood these days have got nothing to do with social reality. They are plastic films that culturally are misinforming their audiences. The India Rising narrative simply isn't the experience of most Indians.

‘But there seems to be a distinct shift away from the hyper commercial films from India,' says Joshi, pointing to recent films such as the political thriller Shanghai and Vicky Donor, a drama about infertility, as evidence. ‘Films such as Gangs of Wasseypur and Vicky Donor have thrown a more critical eye on life in India. And unlike before, independent directors don't struggle to have their films shown. They are released across India's multi-screen cinemas to large audiences. People seem to expect more these days. I think there's an awareness that India has pressing problems: a disillusionment with the political process and corruption.'

Perhaps India's competing schools of film-making might benefit from sharing the nation's multi-screen cinemas. According to Rachel Dwyer, professor of Indian cultures and cinema at the School of Oriental and African Studies in London, the Western view of mainstream Bollywood is onedimensional. ‘Hindi cinema can be political about the personal,' she says. ‘A film which explores homosexuality or religious intermarriage will have an impact.

‘However, it will always be done through the melodramatic form of the film, which should not detract from the argument, as entertainment is the way to reach large audiences.'

Burhan Wazir is Editorial Manager at the Doha Film Institute