Last month, the Press Trust of India (PTI) reported that the central government had decided against raising the Foreign Direct Investment (FDI) cap in print news media from 26% to 49%. The Department of Industrial Policy and Promotion (DIPP) was said to have taken a “considered view” on the subject. They reportedly informed the Department of Economic Affairs against any further relaxation in FDI norms.
Industry voices held a mixed view on the capping of FDI in print media. While some batted for an increase in FDI, there were others who were opposed to the idea of FDI in print.
Paresh Nath, Publisher & Editor of Delhi Press, is fundamentally opposed to the notion of FDI in news media. “Under Article 19 of the Constitution, freedom of speech and expression is entitled to Indian citizens and not foreigners,” Nath said. He further commented that “there should be no FDI either in print or television” news space.
Certain reservations against FDI were raised by Durbar Ganguly, Publisher & Editor-in-Chief of Millennium Post. “I don’t think that FDI cap should be increased,” he said. He stated that FDI in print news media isn’t allowed in other parts of the world as well. Asserting that the news business wasn’t financially lucrative but had an effect on public policy, he questioned the motive of foreign investors who might try to influence the public on various issues.
Speaking in his individual capacity, Hindustan Times’ Resident Editor Nardeep Singh Dahiya batted for increase in FDI. He said that since the “print media is faltering,” FDI would serve as a much needed revenue source. However, claiming that FDI wasn’t the sole source of investment, Ganguly said that print news organisations could opt for “other ways of raising money” including the stock market.
“The debate concerning FDI in print news first cropped up in 1991. At that time, large newspapers were opposed to it as they thought that foreign investment would primarily be directed towards the smaller newspapers,” said Vibodh Parthasarathi, a communication theorist who has carefully observed the business of creative industries. He is presently studying the FDI debate as a part of a larger academic project on media economy in India.
According to Parthasarathi, such a debate crops up every 10 years. He pointed out that the next such debate took place around 2001-02. “Ironically, some newspapers who were opposed to FDI in 1991 changed their position at that time since they were in need of money. The television news channels also rooted for FDI,” he added.
Hinting towards confluence of interest between the government and press, Parthasarathi stated that “anti-FDI voices within the press often tend to hide behind security concerns” flagged by the government.
Tracking & monitoring concerns
Supporting the government’s decision, Mitrajit Bhattacharya, President & Publisher, Chitralekha, described the print news sector as “sensitive”. “Going slow with increase of FDI in print news sector is a prudent decision. It’s a sensitive sector,” said Bhattacharya. He maintained that the since 49% was also a “minority holding”, the government can always take a call regarding it in the future.
While national security happens to be the most frequently stated reason for not increasing the FDI cap in print, there are other reasons too. “Print unlike electronic news is not easy to track and monitor. For instance one can’t track the content of Urdu newspapers every day. In the case of electronic media, the government has Electronic Media Monitoring Centre (EMMC) that keeps a tab on the content of channels,” said PN Vasanti, Director, Centre for Media Studies.
Vasanti opined that there was a certain historical baggage as far as print newspapers were concerned. “Politicians are afraid of touching print just like they are reluctant about allowing news on private radio channels. Print is considered sacrosanct,” she added. She stated that newspapers were in need of FDI for a much needed technological impetus.
“Newspapers wanted to use capital inflow from FDI to improve technology. They could have also utilized the money to reduce their reliance on paid news and advertisements,” said Vasanti. She claimed that since FDI cap had been increased in electronic media, the general understanding was that it would also be done in the case of print.
Not much FDI inflow
Parthasarathi also pointed out that though the FDI limit is 26% but it hasn’t been exhausted mostly. “The data shows that liberal norms aren’t leading to increase in capital. But there has been an increase in Foreign Institutional Investor (FII) components,” he said. He stated that there was a need for both the industry and government to think about it.
Arguing the need for distinguishing between different types of foreign money, Parthasarathi labelled FII as far more “unstable” than FDI. “You need stable sources of money in a sector related to public interest like print news,” he said.
The suspicious foreign hand
Parthasarthi said that the old arguments against FDI appear to be collapsing and there seem to be no new arguments against it. “In the internet age, anyone with a decent broadband connection can access news published by foreign newspapers. Therefore, the argument that increase in FDI limit would lead to foreign press doesn’t stand,” he said.
More importantly, he reasoned that while FDI norms existed for print and television news, no such limit was specified for news on the internet.