THE company behind the publicly funded Indian Film Festival, which opens in Melbourne tonight, is recycling films it has already released and appears to be using government money to rebadge a festival it had already been running as a commercial enterprise.

In October last year, the state government put out to tender a contract to stage a festival of Indian cinema designed to ''develop closer ties'' between Victoria and the subcontinent. In February, while leading a Victorian trade mission to India, Premier Ted Baillieu announced that Melbourne's Mind Blowing Films had won the $450,000, three-year contract. One of the conditions of the tender was that the festival, to run in the years 2012-14, should ''complement, not duplicate, existing Victorian screen events''.

But Mind Blowing Films, which is run by Indian-born producer Mitu Bhowmick, has been staging an Indian film festival in Melbourne, and elsewhere, since 2010. At the launch of the ''new'' festival in May, Bollywood star and festival ambassador Vidya Balan told SBS radio that ''until last year [this festival] was called Bollywood and Beyond''.

Bollywood and Beyond was first staged in Sydney, Melbourne, Perth and Auckland in March 2010. It again ran in Sydney, Melbourne, Adelaide and Auckland in March and April 2011. This year, Mind Blowing is staging the Indian Film Festival Melbourne, as the government-backed event is called, from June 11 to 22. After that, it is staging the Indian Film Festival: Bollywood and Beyond, in Sydney, Adelaide and Auckland.

Film Victoria, which awarded the tender on behalf of the government, insists the Melbourne festival is distinct from the other festivals, despite the considerable programming overlap. Of the 26 films screening in the Sydney festival, 22 will have first screened in Melbourne.

The Age has been told that Mind Blowing does not receive, and has not applied for, government funding to run its festival in NSW or South Australia. Of the 36 films in the Melbourne program, at least six are distributed by Mind Blowing Films and have already been released in Australian cinemas, earning a combined box office of $1.55 million, according to AC Nielsen Rentrak data.

The state government yesterday denied any suggestion that Mind Blowing had a conflict of interest, or that the tender process was in any way flawed. ''The government awarded the contract to Mind Blowing Films after completion by Film Victoria of an open tender process,'' Business Innovation Minister Louise Asher said.

''Tenders were assessed by a panel on the basis of published selection criteria. Following queries by one of the unsuccessful tenders, Film Victoria conducted a review of the tender process and found it had been carried out in accordance with government purchasing policy, including the assessment of any applicable conflicts of interest.''

State government support for film festivals is generally small, mostly less than $10,000. Most other nationality or culture-based film festivals - such as the Jewish, German and Italian film festivals - are privately funded. Launching the festival last month, Ms Asher admitted the government's agenda in backing the festival was not merely cultural. ''I see this festival in the context of a desire to have an economic and a cultural relationship with India. Long term,'' she said.