The Finance Ministry’s hopes of announcing a slew of immediate FDI reforms faced a setback on Monday. The Ministry of Information and Broadcasting (I&B) has decided to seek the views of the Telecom Regulatory Authority of India (TRAI) and the Press Council of India (PCI) on whether to increase FDI caps in the broadcasting and print media to 49 per cent under the automatic route, as proposed by a Finance Ministry panel.
For now, the Ministry has recommended that existing FDI limits be maintained.
In a statement, the I&B Ministry announced that since the “process of consultations” would take time, it had communicated to the Department of Industrial Policy and Promotion that “existing limits of FDI caps and entry routes in the print and broadcasting sectors be continued and status quo in the interim be maintained’.
The Hindu had reported last week that the proposal was stuck because of a divided industry and the “propriety of process”, which required more consultations. Ministry sources had then said that revisions could not be “arbitrary”, and its rationale needed to be explained as existing limits had not yet been reached.
On Monday, the Ministry said it had undertaken “comprehensive consultations” with stakeholders, but “divergent views” were expressed.
The Indian Newspaper Society had sought additional time to comment, while the News Broadcasters Association had not “furnished their comments till date”.
‘Consult TRAI’
It added that TRAI, as the regulator for the broadcasting sector, had to be consulted because of the likely impact of the proposal on the entire sector.
“On 20th September 2012, the foreign investment limits of various segments in the broadcasting sector were revised based on TRAI recommendations.” These were based on the regulator’s consultations with stakeholders.
