Vidya Balan in a Susan Diamasi designed sari Indian Film Festival launch

Breaking the mould: Vidya Balan.

Western audiences outside are ''waking up to the possibilities'' of India's film industry, according to Bollywood firebrand Vidya Balan.

''People are just becoming aware of the contemporary work happening in the Indian film industry and that's a very hopeful situation,'' Balan said during a recent visit to Melbourne to launch the 2014 Indian Film Festival program.

Highlights of this year's program include a 3D re-release of 1975 classic Sholay, with lead actor and Indian demi-god Amitabh Bachchan attending.

Balan, who has just finished filming on India's first female-led detective film, has been an ambassador for the 11-day festival since it took on its current name in 2011.

Such festivals are key for India to break out of the mould of Bollywood, she says. ''It seems that they [the West] are waking up to the possibilities. We're earning more fans the world over. For example, Ifran Khan seems to be a favourite at Cannes and he is even doing a film with [Steven] Spielberg so these festivals open up doors both ways.''

Balan's career is notable for playing stereotype-breaking female leads, including roles as a woman with multiple sclerosis (Guru) and a sufferer of dissociative identity disorder (Manichitrathazhu).

Of her recent detective movie, Bobby Jasoos, Balan said she didn't expect India would be ready for such a film.

''I never thought they'd make a female detective film in India but Samar Shaikh has done a great job … it's an endearing and heartwarming film.''

For her next efforts Balan hopes to work in Melbourne, a place she sees as deeply tied to India. ''I don't know why no one is writing a film for me in Australia! … that's all I'm interested in at this point, I really would like to spend two months here.''

The Indian Film Festival runs May 1-11