TRAI issues new guidelines on foreign investment in broadcasting sector

The Telecom Regulatory Authority of India (TRAI) has come out with a fresh set of recommendations on foreign investment (FI) in the broadcasting sector.

The latest recommendations come in the wake of Ministry of Information and Broadcasting's request to TRAI to revise its initial guidelines on FI, which were announced on April 26, 2008. This became necessary after the Department of Industrial Policy & Promotion (DIPP) announced a consolidated FDI Policy on March 31, 2010.

The DIPP announcement resulted in a modification of methodology to calculate FI in Indian companies. The latest TRAI recommendations are based on its consultation with various stakeholders within the government and outside.

As per the revised recommendations by TRAI, the FI limit for the broadcast carriage services covering DTH, IPTV, Mobile TV, HITS, Teleport and MSOs, who are engaged in upgrading to digital and addressable environment, would be 74 per cent. Also, the FI limit for local cable operators (LCOs) has been suggested to be 26 per cent.

For news and current-affair TV channels, the FI limit has been pegged at 26 per cent. For FM radio too, the investment limit has been recommended to be 26 per cent.

The new recommendations by TRAI also mention that there are no restrictions on FI for the uplink and downlink of TV channels, other than news and current-affair channels.

As per TRAI, all FI investment less than 26 per cent would be through the automatic route. However, investments of 26 per cent and above would require prior approval of the Government of India.