FII funds likely for news channels

New Delhi, March 28 | Updated: Mar 29 2005, 06:10am hrs
An uplinking and downlinking policy for television channels and electronic news agencies is expected within a month, according to sources in the government. The information and broadcasting ministry has sent the draft guidelines to other ministries including communications, law, finance and home for their comments. The guidelines, after incorporating the inputs of other ministries, will be referred to the Union Cabinet.

The new policy is likely to permit FII investment, inclusive of the 26% overall investment cap.

At present, FII investment is not permitted in news channels which uplink from India, and March 31 is the deadline for conforming with the rules. Till the policy is rolled out, news TV channels are likely to be allowed to continue uplinking from India, irrespective of FII investment in them.

The I&B ministry has sought a Cabinet approval to extend the deadline for news channels to adhere to the current norms. The impact of the uplinking and downlinking policy will be felt by several media companies. For instance, once FII investment is allowed in the news category, channels like Zee Telefilms, NDTV and TV-18 would benefit. If the policy includes foreign news agencies, companies like AP-TV would gain. Also, downlinking guidelines would impact Indian and foreign channels across categoriesanything from Star Movies to Zee English, Discovery to BBC or CNN.

Among other things, the uplinking/downlinking policy would focus on regulatory arrangements for channels uplinking from abroad and beaming into India; the foreign equity element in news channels uplinking from India; and the uplinking norms for foreign electronic news agencies. Right now, there is a 26% cap on FDI in news channels uplinking from India. No FDI cap on non-news channels exists now.