It used to be a small rural village, but today Hengdian has evolved into Asia's version of Hollywood. 

The village, in Dongyang city in East China's Zhejiang province, has become the largest film base in Asia known as "Chinawood".

Hengdian World Studios is operated by the privately-owned Hengdian Group. The studio has seen many films and TV shows shot here, including the movie Hero directed by Zhang Yimou andThe Forbidden Kingdom with actors Jackie Chan and Jet Li.

The studio consists of 28 location bases, including scenes from the Qin Dynasty (221-206 BC) to a modern Hong Kong Street.

Even the area of Hengdian village has multiplied 40 times and the average annual income per capita has grown to more than 100 times that of 30 years ago. Every day, the village has more than 20 films shot here and the reason producers choose the village rather than the big cities is simple.

"We used to deliver the furniture for shooting in Beijing, costing more than 12,000 yuan ($1,883)," said Li Shixi, who has worked as a film producer for over 20 years. Hengdian provides all the costumes and stage properties a film needs.

"In Beijing or Shanghai, the shifting of scenes may take one or two hours, here it only takes 10 minutes," he added.

Another advantage of Hengdian is the low administration fee for permission to film - 300 yuan per day. "In other places it may cost 6,000 to 10,000 yuan and even the lowest may cost 1,000 yuan. Here it only takes 300 yuan. Who would not choose here?" said Li.

In 2003, Zhejiang was designated by China as a cultural reform pilot province and the State Administration of Radio Film and Television also set a film industry park in Hengdian. A film company can save about one third in shooting expenses in Hengdian due to favorable policies such as special tax allowances.

Nowadays, hundreds of film companies have registered in Hengdian. New film groups settle here every other day, and with them the tourists follow in greater numbers. 

In 2000, the Hengdian Group announced free rent, the first doing so in China. The group lost revenue of more than 10 million yuan in the first year. At first many staff doubted the effect of the measure.

"The shooting base can be a scenic spot and tourism can be a pillar industry," the founder of Hengdian Group Xu Wenrong told CCTV.

"Many people have never seen filming take place and are eager to see celebrities. They all swarm here and thus tourism prospers," added Xu.

Nowadays, Hengdian receives over eight million tourists annually, ranking fourth among all the scenic spots in China.

Villagers also benefit from the film and tourism industries. Deng Liai is a tailor who used to earn around 20,000 yuan annually. Now she makes costumes for actors and her income has multiplied.

"I receive business from five to six films annually and some also show my names in the film," Deng was quoted by CCTV as saying.

Currently, scenes, costumes, stage properties and "extras" are all provided here. However, these only make up a fraction of the whole expenses of a big film. Some films spend three to four million yuan in Hengdian on production and spend another 30 to 40 million dollars on post production abroad.

Hengdian's next plan is to grab the money that goes overseas for post production. "Whatever the film producers need, we will provide them," said the founder Xu.