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NK Singh committee recommendations may boost DTH market

07-September-2002
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NK Singh committee recommendations may boost DTH market

The N K Singh committee's recommendations to raise the foreign equity cap in Ku-band direct-to-home (DTH) broadcasting to 49 per cent from 20 per cent, if accepted, would see companies showing more interest in the sector, said companies and analysts.

Information and broadcasting ministry officials said the ministry was studying the specific recommendations and it was too early to comment.

According to analysts the 20 per cent FDI cap has been a major factor, preventing companies from venturing into the sector. Companies, like Star TV, which plans to start a DTH service, have been demanding relaxation in the FDI limit.

Satellite broadcasting companies have been lobbying for relaxation in FDI norms for the DTH sector, which is capital-intensive. A typical DTH platform launch costs between Rs 1,500 crore and Rs 2,000 crore.

The committee's suggestion for a more liberal view on FDI in news and current affairs programmes is being seen as an encouraging move.

Pointing out that editorial control for news and current affairs programmes must vest with Indian nationals, the report says the business managers and those who control the commercial decision can, however, be foreigners. It has also suggested that the cap on foreign investment should be based on the company's market share.

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