March 5, 2024

Foreign Direct Investment (FDI) Policy in Broadcasting & Print Media

Earlier FDI was permitted in Broadcasting sector upto 49% through automatic approval route. However, under new FDI policy, such threshold has been increased upto 74%.

There are Three reasons for increased FDI in the sector :

The broadcasting sector is moving towards an addressable (digital) network as per TRAI. estimated by TRAI to cost Rs 40,000 crore.
Mandated increase in FDI due to higher limits in telecommunications (74% under approval route) also utilized for broadcasting.
FDI disparity based on delivery mode within the broadcasting sector.

As per FDI policy issued by Government of India, following are Threshold Limit, terms and conditions of FDi in Broadcasting and print Media sector:

1. Broadcasting Sector

1.1 Threshold Limit of FDI (Foreign Direct Investment) in Broadcasting Sector

As per updated Policy issued by Department of Industrial Policy and Promotion (DIPP) vide ‘Consolidated FDI Policy’, details of FDI policies on Broadcasting is given below:

There are two types of Broadcasting Service :

a. BROADCASTING CARRIAGE SERVICES

Sector/Activity	% of Equity/ FDI Cap	Entry Route
1. Teleports(setting up of up-linking HUBs/Teleports) 2. Direct to Home (DTH) 3. Cable Networks (Multi System operators (MSOs) operating at National or State or District level and undertaking upgradation of networks towards digitalization and addressability) 4. Mobile TV 5. Headend-in-the Sky Broadcasting Service(HITS)	100%	Automatic
Cable Networks(Other MSOs not undertakingupgradation of networks towards digitalization andaddressability and Local Cable Operators (LCOs))	100%	Automatic

Note : Government approval needed for fresh foreign investment beyond 49% in a company not seeking sectoral Ministry license, needs Government approval for ownership change or stake transfer to new foreign investor.

b. BROADCASTING CONTENT SERVICES

Sector/Activity	% of Equity/ FDI Cap	Entry Route
Terrestrial Broadcasting FM (FM Radio),subject to such terms and conditions, as specifiedfrom time to time, by Ministry of Information &Broadcasting, for grant of permission for setting up of FM Radio stations	49%	Government
Up-linking of ‘News & Current Affairs’ TVChannels	49%	Government
Uploading/Streaming of News & Current Affairsthrough Digital Media	26%	Government
Up-linking of Non- ‘News & Current Affairs’ TVChannels/ Down-linking of TV Channels	100%	Automatic

1.2 Conditions for FDI in Broadcasting Sector

FDI for TV channel up-linking/down-linking shall be subject to compliance with relevant Ministry’s policies.
The foreign investment (FI) in companies offering aforementioned services subject to Ministry’s specified regulations and conditions specified from time to time.
The foreign investment (FI) limit in companies engaged in the aforestated activities shall include, in addition to FDI, Foreign Portfolio Investors (FPIs), Qualified Foreign Investors(QFIs), Non-Resident Indians (NRIs), Foreign Currency Convertible Bonds (FCCBs), American Depository Receipts (ADRs), Global Depository Receipts (GDRs) and convertible preference shares held by foreign entities.
Foreign investment in broadcasting carriage services subject to specified security conditions/terms.

2. Print Media

Foreign direct investment (FDI) is significant for the media industry, involving ownership control by foreign entities. FDI includes mergers, acquisitions, new facilities, reinvesting profits, and intra-company loans. In a narrow sense, it means building new facilities, often with management participation, joint ventures, and technology transfer.

FDI greatly impacted Indian media with the Government approving 26% FDI in print and 49% in TV media in 1991. Cable TV in India emerged due to FDI, as before 1991, the Indian audience only had Doordarshan to watch which is India’s national broadcaster.

FDI in India was permitted via two different routes: Automatic and government. Under automatic, no prior approval was needed, while government route required approval. India permitted 26% FDI in print publications, leading to increased funding in newsrooms and improved journalist salaries, boosting financial security.

2.1 Threshold Limit of FDI (Foreign Direct Investment) in Print Media

As per updated Policy issued by Department of Industrial Policy and Promotion (DIPP) vide ‘Consolidated FDI Policy’, details of FDI policies on Print Media is given below:

Sector/Activity	% of Equity/ FDI Cap	Entry Route
Publishing of newspaper and periodicals dealingwith news and current affairs	26%	Government
Publication of Indian editions of foreign magazinesdealing with news and current affairs	26%	Government

2.2 Other Conditions

“Magazine”, as defined here, is a non-daily periodical publication that contains public news or comments on public news.
Foreign investment must Follow the Ministry of Information & Broadcasting Guidelines for Indian editions of foreign magazines on news and current affairs issued on December 4, 2008,and updated periodically.

Sector/Activity	% of Equity/ FDI Cap	Entry Route
Publishing/printing of scientific and technicalmagazines/specialty journals/ periodicals, subjectto compliance with the legal framework asapplicable and guidelines issued in this regard fromtime to time by Ministry of Information andBroadcasting.	100%	Government
Publication of facsimile edition of foreign newspapers	100%	Government

Other Conditions

Only owners of the original foreign newspapers can invest in FDI for publishing their facsimile editions in India.
Only Indian entities registered under the Companies Act can publish facsimile editions of foreign newspapers in India.
Publishing facsimile editions of foreign newspapers in India must comply with the Ministry of Information & Broadcasting Guidelines issued on 31.3.2006 as amended from time to time.

DISCLAIMER: The views expressed are strictly of the author and VJM & Associates LLP. The contents of this article are solely for informational purpose. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon.

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