TRAI favours 74% foreign investment in DTH, Cable Network

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New Delhi, Apr 27 (UNI) The Telecom Regulatory Authority of India (TRAI) has released its recommendations on foreign investment limits for the broadcasting sector under which it proposes a hike in foreign investment in the DTH, Teleport, and Cable Network from the present 49 per cent to 74 per cent.

''Foreign investments have an important role as a source of funding in the development of the sector. Foreign investments have other benefits also such as bringing in new technology, international best practices, and access to export markets,'' a statement said.

However, the extent of foreign investment is also conditioned by considerations such as national security, preserving sociocultural fabric of the country, protection of domestic industry among others, it added.

The Ministry of Information and Broadcasting had sought recommendations of the authority on foreign investment limits for various segments of broadcasting sector on December 11, 2007.

In line with its consultative approach, the Authority issued a Consultation Paper on March 3 this year for comments from the stakeholders before giving its recommendations to the Government on foreign investment limits for various segments of broadcasting sector.

Trai said it favours 74 per cent foreign investment in the HITS category where no policy exists as on date.

For FM Radio, the authority proposes to raise the foreign investment limit from the present 20 per cent to 49 per cent while it proposes to maintain status quo in the downlinking of TV Channels at the present 100 per cent.

Trai said it favours 49 per cent of foreign investment in the uplinking of TV News Channel from the present 26 per cent.

The statement said in the category of uplinking of Non News TV Channels, status quo be maintained at the present limit of 100 per cent foreign investment.

For Mobile Television, where no policy exists at the moment, Trai proposes 74 per cent foreign investment.

The percentage of foreign investment includes foreign direct investment (FDI) and foreign institutional investment (FII).

The recommendations also cover the procedure for approval and suggest that within the composite foreign investment limit of 74 per cent (wherever applicable) for carriage services, foreign investments up to 49 per cent may be permitted under the automatic route. Beyond this, FIPB approval would be required as prescribed for the telecom sector.

For content services, it has been suggested that FIPB approval should be required for foreign investments. The methodology for calculation of foreign investments in different segments of broadcasting is also proposed to be standardised.

In this direction, it has been recommended that methodology used in telecom sector for calculation of foreign investments should be adopted for the broadcasting sector as well.

UNI PBB SG AS1522

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