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‘Policy initiatives to propel newspaper growth in India’

30-August-2004
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‘Policy initiatives to propel newspaper growth in India’

It’s a study in contrast in some ways for China and India. Although government initiatives may have an adverse impact on newspapers in People’s Republic of China, they’ll be helpful for India, according to a Price-waterhouseCoopers (PwC) survey. In the case of China, it talks about government ending newspaper subsidies; and for India, it refers to relaxation of foreign investment norms. But, in terms of advertising, China and India show similar trends in the newspaper publishing industry.

Under the new regulations in China, “provinces are permitted to fund only two publications and cities, only one. Moreover, government agencies and their employees will no longer be required to purchase newspapers.” That led to cut in fundings for papers and resul-ted in closings. “We expect a near-term decline in unit circulation and in circulation spending...,” it points out. However, according to PwC, the China market will stabilise in 2006.

Coming to India, the study ‘Media Outlook 2004-2008’ refers to 26 per cent foreign direct investment allowed in print media in 2002. Due to this development, “we look for circulation spending growth in India to average 4.8 per cent compounded annually during the next five years,” it adds.

Head of entertainment and media practice, PricewaterhouseCoopers, Deepak Kapoor, told FE: “We project the newspaper publishing industry in Asia/Pacific will expand at a 2.7 per cent compound annual rate, from $41.4 billion in 2003 to $47.3 billion in 2008.” He added that “the highest of this projected growth will be in India at 6.9 per cent compound annual rate fuelled by government initiatives and potential market size in India.” Also, India is emerging as a promising market for new publications given its growing role in international business, he said.

Due to a hike in FDI limits in the newspaper publishing sector, “a lot more action is likely to be seen from the global players wanting to invest in this sector,” according to Mr Kapoor.

In terms of advertising, it was a mixed market in 2003, said PwC. Both India and China, recorded 20 per cent increase in newspaper ads. In Asia-Pacific region, Thailand was up 11.6 per cent, while Hong Kong, Japan and Singapore registered decreases.

On the whole, advertising in this region across newspaper publishing industry is expected to increase to a projected $24.2 billion in 2008, from $19.3 billion in 2003.

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