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Tag: FII investment

  • Government okays FII investment in news ventures

    NEW DELHI: The Indian government today formally decided to allow publication of facsimile edition of foreign newspapers in the country as also investments by non-resident Indians (NRIs) and foreign financial institutions (FIIs) in news ventures in print and TV.
     

     
    However, the total foreign investment, including FDI, NRI, overseas corporate bodies (OCBs) and FIIs, in a news venture in both the media remains capped at 26 per cent.

    At meeting today, chaired by prime minister Manmohan Singh, the Union cabinet allowed publication of facsimile editions of foreign newspapers and journals in India, minus local ads or content.

    This would mean that London’s Financial Times, for example, could re-print an edition in India without covering local Indian news or advertisements.

     
     
    However, if there’s a report filed by the India correspondent of FT for the London edition, that report could be carried.

    Briefing journalists today after the Cabinet meeting, information and
    broadcasting minister Jaipal Reddy said it has also been decided to increase the syndication limit of the total printed area from the present 7.5 per cent to 20 per cent under the automatic route.

    The minister added that the changes would be incorporated through amendments in the PRB Act with a view to give legal backing to the Cabinet decisions.

    Asked whether allowing facsimile editions would mean a threat for the Indian newspapers, Reddy ruled out any such thing happening as the facsimile editions of foreign newspapers would have access to local news and ads.

     
     
    Listed media companies like Television Eighteen Ltd, Zee Telefilms and NDTV have been lobbying with the government to clarify its position on the issue of FII investments in broadcast ventures.
    This has been one of the reasons why companies like Zee Telefilms and TV 18 have not yet managed to restrucuture their news operations. Government norms for uplink state that in any TV news venture, uplinking from India, total foreign investment should be capped at 26 per cent, which is not yet the case with Zee News and CNBC TV 18.

    Contrary to expectation, proposed changes in the FM radio broadcast policy, which is pending with the Cabinet secretariat, could not find a place on the agenda of today’s meeting.

    Reddy could not give a time frame for the radio policy to be taken up by the Cabinet, though he admitted that a note has been sent by the ministry for the Cabinet’s consideration.

  • FII investment in TV news ventures: only cabinet nod remaining

    NEW DELHI: The government today officially admitted that a decision has been taken in principle to allow FII investment in TV news ventures, bringing it at par with norms for the print medium.

    However, the FII investment would form part of the over allzz foreign investment cap of cap of 26 per cent

    Information and broadcasting ministry has also firmed up changes that would be effected in the radio broadcast policy, including those for FM radio, wherein the bidding process would not be done away with.

    Speaking to journalists on the sidelines of a function to announce measures being taken by the ministry relating to content regulation, which was reported by indiantelevision.com last week only, a senior ministry official said, “We are of the opinion that FII investment in news channel ventures should be allowed and a note relating to this has been circulated amongst other ministries.”

    As reported by indiantelevision.com earlier, the clarification on FII investment in news channels uplinking from India would be issued by the government “soon after a formal Cabinet nod is taken,” the official said.

    This sets to rest speculation on FIIs investments, making life easier for listed media companies like TV Today Network, Television Eighteen and NDTV. In one case, NDTV had to issue an advisory to investors saying FIIs and people of foreign origin and/or non-resident Indians should not deal in NDTV shares on the stock exchange s the limit had been reached.

    The government official also said that a note on radio policy has been finalised, which partly takes suggestions from the sector regulator, Telecom Regulatory Authority of India.

    Though the bidding process in unlikely to be done away with fully, the official pointed out that a licensing structure would be put in place with the aim to keep the fee at a “reasonable” level.

    The I&B ministry has also decided to truly empower the people with community radio by handing over such projects to the community minus cumbersome clearance procedure.

    Meanwhile, I&B minister Jaipal Reddy today announced that a roundtable of broadcast industry stakeholders have been called to dwell on various aspects of content regulation, which would be separate from a downlinking policy that had been proposed.

    The interaction, slated for later this week, is expected to come out with recommendations for amendments in the existing programming and advertising code, changes that need to be effected in the role and functions of a regulatory body and the nature and scope of codes and standards under the proposed new legislation.

  • I&B ministry clears FII investment in TV news channels

    I&B ministry clears FII investment in TV news channels

    MUMBAI/NEW DELHI: The information and broadcasting ministry has cleared the decks for foreign financial institutions investing in television news channel ventures by issuing some modifications to the existing guidelines.

    The ministry has said that FIIs can invest in news channels and companies managing them, but the total foreign investment component will remain capped at 26 per cent. In effect, this means that FII investment has to be part of the total foreign investment allowed, including foreign direct investment.

    An official in the I&B ministry said that it was a matter of interpretation, but since some clarifications were sought by media companies, the ministry has decided to remove the ambiguities.

    The official also pointed out that it was only after this ambiguity was removed that NDTV got a clearance recently from the ministry for uplinking its proposed business channel from India.

    On 10 December, 2004 NDTV had issued a notice to the Bombay Stock Exchange (BSE) stating that it has asked FIIs, NRIs and all persons resident outside India not to deal in its shares. Pointing out that the ministry of information and broadcasting had amended guidelines and foreign investment norms for news and current affairs news channels, the NDTV notice had said that Clause B prescribes that foreign direct investment (FDI) shall not exceed 26 per cent of the paid-up equity capital of the applicant company.

    The FIIs issue, according to an earlier interpretation of the ministry, had sent some listed media companies like Television Eighteen Ltd, TV Today Network and NDTV LTD, scurrying to the government seeking clarifications.

    It had been pointed out by the media companies that keeping a tab on FII investments in listed companies on a daily basis, where buying and selling happens on the markets, would be difficult and that the Companies Act allows FII investment in various sectors, subject to sectoral foreign investment caps.

    Clause D of the guidelines states that while calculating the 26 per cent FDI in the equity of the applicant company, the foreign holding component, if any in the equity of the Indian shareholder companies of the applicant company, will be duly reckoned on a pro-rata basis, so as to arrive at the total foreign holding in the applicant company. Clause F states that it is obligatory on the part of the company to take prior permission from the MIB before effecting any alteration in the foreign shareholding patterns and the shareholding of the largest Indian shareholders.

  • It brings print on the same platform as broadcasting, telecom: Mid Day Multimedia’s Tariq Ansari

    It brings print on the same platform as broadcasting, telecom: Mid Day Multimedia’s Tariq Ansari

    It’s extremely positive. It brings print on the same platform as broadcasting and telecom. There were concerns of national security and these have been addressed in the Cabinet decision through safeguards. So far there is nothing which could be a problem in the new announcement. 

    The decision is a progressive move, however, it will have no immediate impact on our plans. Last year we had an IPO. We have the capital, however, we may need some technology. We have no reason to sell out at this stage. We have our plans but a divestment of equity to a foreign investor is not on the cards now. The opening up of FDI gives us an option sometime down the road. 

    We do not believe that FII investment being allowed in print is a natural consequence of this current decision. That’s an issue which has to be decided by the RBI.