Not clear why FDI levels are restricted in the media space.
On the face of things, the government has done well to permit up to 26% FDI for digital media in the ‘news & current affairs’ space, as the official press release says, ‘on the lines of print media’. But, the question really is, why have any caps and why make this subject to government approval? The reason, never stated upfront, is probably that the government – the current one and all previous ones – believes that foreigners can’t be trusted to give unbiased news/views and so it is best to restrict their spread. That’s also the reason why, when FDI was allowed in print media, restrictions were put to ensure all top positions like that of the editor were held by Indian citizens; several editors have been asked to leave as they were not Indian citizens.
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But even if you buy this argument, and also believe readers/viewers are too stupid to figure this out, all foreign TV channels can be viewed in India and all foreign newspapers can be bought here and, thanks to online media, be read for next-to-nothing or even free. So if 100% FDI is allowed in the real sense, why not legalize it? And if foreign ownership needs to be restricted because it is bad, why are 49% levels allowed in TV news which, most would agree, has a greater reach/penetration than newspapers? Also, in these days of convergence, what is print, digital or television? Is a newspaper with an online presence to be viewed as digital, and what of a digital platform that provides news/views in both text and video; is this digital or television? Depending on what view the government takes, the entity can get more FDI or may have to reduce it. Are the likes of Google newspapers or aggregators; if they are the former, does the India operation need to find a 74% local partner? It is not just Google, several entities that provide news/views in text/video form have 100% FDI today; will they have to lower this now? Nor is it clear why the government has made a distinction between up-linking and uploading/streaming when it comes to FDI limits. It is obviously true that TV channels do ‘uplinking’ while websites do uploading/streaming, but if the end result is subscribers getting to watch content instantaneously or near-instantaneously, aren’t they the same thing?
While the media has been at the forefront of the clamour to open up the economy and liberalise it by lowering import duties and allowing more FDI, unfortunately, the more influential news organizations have never been in favour of this in the media space. After all, if smaller newspapers got FDI and used this to expand their growth, this would hit the larger players which may not provide news/views of the same standard. Some established editors, anxious to protect their jobs, then convinced the government to ensure only Indians could become editors; imagine the furore if a rule said no CEO of a hotel or an airline operating in India could be a foreigner! Such Bombay Club-type restrictions have no place in a modern India.