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Guest Column: Usher in fresh investment & provide a tax holiday for radio players

10-July-2014
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Guest Column: Usher in fresh investment & provide a tax holiday for radio players

FM Radio in India is on a cusp of expansion.
This shall create about 12000 to 16000 more jobs in the market, largely in small towns.

Take the reach of the only medium which is free for the consumer, to around 80 per cent of India, from the current 40 per cent.

Provide an opportunity for small traders and retailers in these 300 towns to advertise on a cost effective medium and thereby expand their businesses by reaching out to new consumers.

It added approximately Rs 1600 crore to the government’s coffers through the auction and license fees.

This budget therefore is crucial and the sector broadly needs a nudge in two areas:

1. Facilitate further investment:
For more than half a decade, Government has not taken any measures to usher in fresh investment or expansion of FM footprint in India. It is about time that it takes decisive actions to trigger fresh investments.

Government should increase the FDI to a minimum of 49 per cent and should also clear the long pending TRAI recommendation.

These measures would help radio networks raise capital and also make the environment more conducive for foreign investment.

2. Shot in the arm
The sector needs a shot in the arm. It is quite obvious that some of the towns that are up for auctions would hardly break even. Government should provide a tax holiday to encourage radio players to invest in the otherwise no-so-viable-markets.

Networking of stations and news should also be allowed. These are much awaited and needed regulatory changes that shall create fresh excitement in the medium and therefore enable growth.

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