The department of industrial policy and promotion (DIPP) has moved a Cabinet note to rationalise foreign direct investment limits in various sub-sectors of broadcasting to bring it on par with the telecom sector. In the proposal for the Cabinet Committee for Economic Affairs (CCEA), DIPP has sought to raise the FDI cap to 74% as against the current 49% in delivery platforms like DTH and teleport and 24% from the current 20% in FM radio.
FE was the first to report last month that the information and broadcasting ministry had proposed the above revision in foreign investment and forwarded the same to DIPP.
As per the proposal, in case of DTH and teleport, prior approval of foreign investment promotion board (FIPB) would be required for FDI beyond 49%. Currently FIPB approval is required for any level of investment in the above sub-sectors. At present, in case of DTH, the cap on the FDI component is limited to 20% within the composite foreign investment cap of 49%. Further, FIPB approval is required for any level of investment in the above sub-sectors. In case of FM radio the note says that FDI up to 24% will be allowed with prior FIPB approval.
However, in case of FDI limits in platforms like HITS, satellite radio and mobile TV, DIPP has reserved its view as a policy on these sectors is still in formulation stages and under the I&B ministry?s consideration.
However, Telecom Regulatory Authority of India (Trai) had recommended a hike in the foreign investment cap for the sub-sectors of HITS, mobile TV (to 74%), and satellite radio (to 100%) as there?s convergence happening between telecom and broadcasting sectors.
The recommended foreign investment caps in broadcasting and telecom sectors would be composite caps which includes FDI and FII, both direct and indirect.
