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FDI limit in broadcast may be raised
16 February 2011: The Union Government is considering allowing foreign firms to own up to 74 per cent of broadcasting companies, along the lines suggested by the telecom regulator seven months ago.
At present, different FDI limits apply for different segments in the broadcasting industry and the regulator had suggested bringing uniformity and raising the limits.
The Telecom Regulatory Authority had, in July 2010, suggested unifying foreign investment limits — currently as low as 20 per cent in some segments — to 74 per cent in most segments, while making an exception at 26 per cent for FM radio and TV news channels.
The broadcast sector consists of channels as well as distribution media such as DTH, cable etc. 100 per cent foreign investment is allowed in non-news channels, while most distribution channels have to have 51 per cent Indian ownership — a reason for the failure of government’s digitisation drive.
Under the current policy, private companies are allowed to broadcast news through their TV channels, but cannot distribute it on radio.
The ministry maintains that radio has greater reach and impact compared with TV, and therefore, allowing private news networks on radio will make it difficult for government to control how events are perceived.
Source: DNA