Set up by the Madhya Pradesh Government in 1978 to immortalise the memory of poet-dramatist Kalidasa, this academy is a multi-disciplinary institution for people interested in the creative fields of theatre and poetry. The academy's objective is to study and explore Kalidasa's literature and work on its translations, publication and documentation. The academy has also established a model Sanskrit theatre as per the norms of Bharata's Natya Shastra. The academy's complex has a museum of Sanskrit theatrical arts and a library of traditional music, theatre and dances. Moreover, there are seminar and lecture halls, research facilities, a large open-air theatre and a mini stage for rehearsals. All the rooms in the main building have been named after works by Kalidasa such as Kumarasambhavam, Meghadutam, etc. The academy's library has a classified repository consisting of more than 4,000 books on various Indological subjects as Veda, Vedanga, Purana, Philosophy, Vedic and Sanskrit literature, Natya, Nritya, Sangita, Vastu-Shastra and more, apart from a vast collection of Kalidas's works.

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