The Narendra Modi government has begun discussions on whether to allow more foreign investment in the media sector, including in the print and broadcast news segments. This move could pave the way for fresh infusion of global capital in the cash-starved but fast-growing business.
Information and broadcasting (I&B) minister Arun Jaitley recently reviewed a departmental presentation on the case to review “sectoral FDI caps” in the media space, HT has learnt. The matter has now been referred to an inter-ministerial panel, which will come back to Jaitley for a decision. In case the caps are to be revised higher, a Cabinet proposal has to be moved.
Though India has been steadily opening up its economy to foreign investment, governments have been touchy about some areas, such as news content, where they were unsure about its social impact or implications on national security.
Chasing investments to bolster growth, the Modi government took two crucial FDI decisions recently: it raised the maximum amount of foreign ownership in military-equipment firms to 49% from 26%. It also allowed up to 100% non-Indian ownership in railway-construction companies.
Ongoing consultations in the I&B ministry, which will set in motion the Modi government’s media-investment policy, are the first deliberations since the Telecom Regulatory Authority of India (TRAI) — India’s main media regulator — recommended easing of various limits in 2013 on foreign direct investment (FDI) in media.
FDI caps of various levels currently govern media investments, varying between 26%-74%, depending on the nature of media business. A keenly watched space is news media, print and digital, where FDI is limited to 26%. TRAI’s proposal is to enhance this — in the case of broadcast news — to 49%.
The Indian Newspapers Society, a lobby group, has made a case for a similarly higher FDI cap in print media.
The ministry’s initial view is that the caps need to be reviewed and a “view taken on TRAI proposals”, a source said