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TRAI to review foreign investment limits on broadcast sector

04-March-2008
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TRAI to review foreign investment limits on broadcast sector

The Telecom Regulatory Authority of India (TRAI) on March 3 issued a consultation paper for reviewing the existing foreign investment limits in different segments of the broadcast sector. The consultation paper seeks views from stakeholders on various policy issues.

TRAI has recommended that the composite foreign investment limits for FM radio broadcast permission holders, who are interested to broadcast news, should be raised to 26 per cent from the present 20 per cent in view of FDI provision of 26 per cent in news and current affairs in television broadcast. The composite foreign investment limit for FM radio broadcast permission holders, who do not opt for news broadcasting, should be increased to 49 per cent from the present 20 per cent.

It has further been recommended that the composite foreign investment limit for FM radio broadcast permission holders should be revised as and when Government takes any further decision to revise FDI limits for TV broadcast, including news and current affairs.

The consultation paper has sought stakeholders’ opinion on various policy issues, including the need for revision of FDI limits; quantum of FDI limits and sub-limits for FDI and FII within this limit; permission for foreign investment through the automatic route or need for a sub-limit beyond which FIPB approval be required; classification of different segments of broadcast sector into carriage services and content services for the purposes of laying down FDI limits; with the convergence of telecom and broadcast sectors, the need for alignment of foreign investment limits in broadcast sector with the foreign investment limits in the telecom sector; and, standardisation of methodology for calculation of foreign investment limits in different segments of broadcasting sector.

TRAI has invited all stakeholders to respond to the issues raised in this consultation paper by March 28, 2008. The comments received would be posted on TRAI’s website.

The I&B Ministry has sought TRAI’s recommendations on FDI limits for various segments of the broadcast sector such as news and non-news broadcasters, teleport, DTH, satellite radio, Headend-In-The-Sky (HITS), cable operators and FM radio. Earlier, while sending its comprehensive recommendations separately for HITS, mobile TV and FM radio, TRAI had also recommended that FI caps should be fixed at 74 per cent for HITS and mobile TV, and 26 per cent for News FM radio service and 49 per cent for non-News FM radio service.

The Authority has recommended enhancement of composite foreign investment limit for FM radio broadcast permission holders in its recommendations dated February 22, 2008.

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