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Rejuvenated Print
Media Policy?
The Government of
India ("GoI") vide a cabinet decision on June 16, 2005
("Cabinet Decision"), has decided to permit investments
by non-resident Indians/Persons of Indian Origin ("PIOs")
and portfolio investments by recognized Foreign Institutional
("FIIs") in news and current affairs publications,
in addition to foreign direct investment ("FDI"). However,
the aggregate sectoral cap on foreign investment in a news venture
in print medium will remain at 26 percent.
In 2002, the GoI
lifted an antiquated ban on foreign investment in the print media
sector by permitting foreign investment upto 26 percent of paid
up equity capital, in the form of FDI only, in Indian entities
publishing newspapers and periodicals dealing with news and current
affairs and upto 74 percent in non-news titles.
Earlier this month,
the Ministry of Information and Broadcasting ("MIB") completely
liberalized the non-news category by enhancing the foreign investment
cap from 74 percent to 100 percent in the case of Indian entities
publishing scientific/ technical/specialty magazines / periodicals/
journals. The MIB declared that in cases where both FDI and FII
investment is envisaged, the foreign investor required FIPB clearance
(for FDI) / RBI clearance (for portfolio investments), after obtaining
an No Objection Certificate ("NOC") from the MIB and in
cases involving only portfolio investment, the foreign investor
required only RBI clearance, if any, after obtaining NOC from
the MIB.
The Cabinet Decision
has also permitted publication of facsimile edition of foreign
newspapers subject to prior permission from the MIB. A facsimile
edition of a foreign newspaper may now be brought out by an Indian
entity, with or without FDI, as also by foreign companies owning
the original newspaper provided they get incorporated and registered
in India under the Companies Act, 1956 subject to suitable safeguards
to ensure that they comply with the Indian laws. Any such facsimile
edition is to be brought out with the approval of the regulatory
authority of the country of origin and must be a standard publication
in that country and must not be specially designed for Indian
readers. These newspapers will not be allowed access to Indian
content or advertisements. The Cabinet Decision emphasized the
GoI stand that Indian editions of foreign newspapers are not permitted.
The Cabinet Decision
also indicated a proposed increase in the syndication limit, as
prescribed under the current MIB Guidelines for Syndication Arrangements
by Newspapers for procuring content from foreign publications,
from 7.5 percent to 20 percent of the total printed area under
the automatic route. Cases above the 20 per cent limit are to
be considered in the MIB on a case-by-case basis.
The Union Minister
(Information & Broadcasting), Mr. Jaipal Reddy, indicated that
suitable amendments to the Press Registration of Books Act will
be required in order to implement these proposed changes.
Although the widening
of scope of investments is a step in the right direction, the
Cabinet Decision merely whets the appetite of foreign investors
eagerly awaiting inroads into the lucrative Indian news publication
business without actually enhancing the foreign investment limit.
Source:
Press
Information Bureau
You
can direct your queries or comments to Kishore
Joshi and Roshan
Thomas
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