The first batch of Phase III auctions might not take place by the promised May-end deadline as security clearances for certain operators have yet to be received from the Home Ministry.
The most prominent among them is the ongoing tussle between the ministry and Sun TV, or rather, Kalanithi Maran, the founder and head of the network. Sun TV runs one of the largest radio networks in the country under the brand name RED FM and Suryan FM (Tamil Nadu). Between the two, they account for more than 45 radio stations.
Maran is under investigation by the CBI in connection with the Aircel-Maxis controversy and has seen part of his assets attached by the Enforcement Directorate (ED) in relation to this case. This would probably explain why the Home Ministry is showing reluctance to grant a clearance to the network.
In the worst case scenario, if the Home Ministry is adamant in its stance, we might well see one of India’s largest private FM networks shutting shop. The chances of this happening are quite low but it does remain a possibility. It is more likely that the Ministry will consider delinking the two issues and allow RED FM and Suryan FM to continue operations, while the investigation against Maran is carried out in parallel.
Sources within the radio industry agreed that the Sun-Home Ministry issue is one of the main causes delaying the auctions. “An action, if any, should be taken against the Director (Maran) and not the company. It is not fair on the channel and will cause radio operators worry if the government starts taking such steps (closing down of a station),” said one operator who did not wish to be named.
Another radio operator we spoke to maintained that postponing the auctions indefinitely just to ensure the pending security clearance issues are resolved will “compromise everything”. A person familiar with the situation said that the Home Ministry would most likely revert with its decision by next week.
The MIB was expected to release a list of participating radio stations (in the auction) on May 11; a date which has come and gone. Industry insiders said that a new date has not been yet received and MIB is being non-committal about confirming any new dates till the Home Ministry sends its approvals.
To be fair to Sun TV, it is not the only one whose clearance is in the pipeline. Sources say that the Home Ministry is still evaluating the clearances of a couple of other smaller stations, which are mainly new entrants and single-city operators, though there does not seem to be any reason to believe that there will be any significant issues with their clearances.
Officials from RED FM and Suryan FM remained unavailable for comment. Bimal Julka, Secretary (I&B) did not reply despite numerous attempts.