The Telecom Regulatory Authority of India (TRAI) has proposed an increase in foreign direct investment (FDI) limit in broadcast, generating a debate among the stakeholders including broadcasters, cable TV operators. The telecom and broadcast watchdog has suggested this in a consultation paper seeking stakeholders’ views.

TRAI has pushed for an increase in FDI limit in broadcast from the current levels – news broadcast 26 per cent and carriage services (DTH and Cable network) 74 per cent – on the grounds that growing convergence between broadcast and telecom sector cannot be ignored. This will help ensure level playing between competing technologies, it said.

In the paper, TRAI has proposed that the same logic used for the proposal to increase FDI in telecom to 100 per cent (automatic approval for all proposals up to 49 per cent equity and the balance to be routed through the Foreign Investment Promotion Board) should be applied to direct-to-home services and cable TV.

The last date for submission of the views is August 12. The watchdog has come out with the paper following the Information & Broadcasting Ministry’s request to recommend FDI caps for the broadcaster.

“Keeping in mind the fact that the ongoing digitisation of the cable TV services in the country would give a big impetus to the convergence of the broadcasting and telecom infrastructures, the same limits and route ought to be made applicable to the carriage services in the broadcasting sector,” it suggested.

For the news and current affairs television channels, the watchdog has proposed an increase in FDI limit to 49 per cent from 26 per cent through the FIPB route. This will help broadcasters reduce their dependence on advertisement revenues and help them access resources for their channels at competitive rates, it argued.

It has asked stakeholders for their view on whether any changes are required in uplinking guidelines to safeguard editorial and management control. Currently, there are conditions such as employing resident Indians at key positions and that the largest Indian shareholder should hold at least 51 per cent of the total equity, among others, to this effect. TRAI has suggested that with an enhanced FDI cap, the remaining Indian shareholding would have to be with a single Indian shareholder.

It has suggested that instead of using FDI limits to check on undesirable content on news channels, a proper content code should be put in place to check on airing of any such content.

In FM radio too, the regulator has proposed an increase in the FDI limit from 26 per cent to 49 per cent through the FIPB route.

Meenakshi.v@thehindu.co.in

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