The ministry is also planning to make uplinking mandatory for direct-to-home television service providers.

Sources told The Financial Express that the government is planning to offer as much incentives as possible in terms of taxes and duties to attract investment in media as well as broadcasting infrastructure like earth stations.

In the second phase, the government wants all the channels to uplink through Videsh Sanchar Nigam Ltd (VSNL), which is going to substantially improve the company's revenue position, sources added.

Sources further said the ministry has suggested incentives similar to IT software companies for media software companies to promote India as the media hub of the next millennium.

In case of DTH, a similar strategy has been thought of, sourcesstated. They said even though all the channels carried by the DTH operator may not have to uplink from the country, it would be mandatory for the service provider to uplink from the country.

Uplinking would be one of the points of regulation for the government, sources added. The other points of regulation for the government include uniform programming code and licence fee.

Sources said the note on DTH, which is to circulated among the members of group of ministers (GoM), is also complete.

The note has listed all the pros and cons of a service like DTH in the country, sources said. "Though the final decision on DTH would be taken by the GoM, however, the ministry feels the entry of new technology should not be prevented," sources added.

On the subject of foreign equity to be allowed in DTH, sources said the ministry is contemplating a liberal stand to allow as many players as possible in the sector.

The GoM is expected to meet during the recess of the current parliamentary session to take a view onthe subject.

On media software companies, sources added that the government has decided to take a liberal stand. Earlier, the government had decided to allow 74 per cent foreign equity in media software companies. The I&B ministry has also decided to allow 74 per cent foreign equity in advertisement ventures in the country.