Government on Tuesday had announced an increase in the FDI limit of news and current affair channels, DTH and Cable Operators. Foreign investment will now be relaxed in 15 sectors. While 100% FDI has been allowed in DTH and Cable Networks (MSOs and LCOs), the foreign investment in the uplinking of news and current affairs TV channels has been raised to 49% from 26%.
Government has also raised the Foreign Investment Promotion Board (FIPB)’s monetary limit to Rs.5,000 crore from Rs.3,000 crore for the approving of FDI proposals. The proposal is also said to contain many other long pending corrections including the proposals pertaining to limited liability partnerships and also NRI-owned companies who are looking to invest in India.
Expressing his pleasure at this announcement, Sudhanshu Vats, Group CEO, Viacom18 and Chairman, CII National Committee, Media and Entertainment said, “This seems to be an excellent way to flag off Diwali celebrations in the country. My compliments to our Prime Minister Narendra Modi and our Finance Minister Arun Jaitley. The announcement emphasizes the need to align more industries to the automatic route of FDI, over the government regulated route, to enhance ease of raising capital. The increase in the FIPB limit from Rs.3,000 crore to Rs.5,000 crore expands its financial ambit thereby allowing for an increase in the quantum of proposals of interest. By opening up certain industries the focus will shift to exploring newer markets with growth potential. For the Media and Entertainment industry in particular, the news broadcasters, radio, mobile TV market, cable broadband networks and DTH will witness accelerated investor interest.”
In an article published last month on exchange4media Dr. Subhash Chandra, Chairman, ZEE Media and Essel Group has spoke about the increase in FDI limit. “I am not against the 49% foreign ownership in the news media or even 100% for that matter. But together as a sovereign nation I will still voice if Americans want 100% ownership of news here, they should give me 100% news ownership in that country. As long as they give reciprocal deal I have nothing against them,” he said.
In an earlier article exchange4media had already carried the news regarding the government’s plans to increase the FDI cap of news and current affairs channels to 49%. TRAI had earlier in 2013 recommended that the FDI limit should be increased to 100% from 74% in broadcast carriage services like cable TV, DTH, IPTV and mobile TV.
It had also recommended the FDI limit of news and current affairs TV channels and FM radio services to be increased to 49% from 26%.