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Foreign equity for news channels capped at 26 p.c.

By Our Special Correspondent

NEW DELHI MARCH 18. The Union Cabinet today decided to change the policy for satellite uplinking from within the country for news channels by introducing a cap of 26 per cent on foreign investment, thereby creating a level playing field for both print and electronic media.

The decision comes in the wake of the application made by media baron, Rupert Murdoch's wholly foreign-owned Star TV to uplink from Indian soil beginning this April following the end of its contract with NDTV. Besides Star TV, applications from two other partially/wholly foreign-owned news channels are pending with the Information & Broadcasting Ministry.

As for editorial and managerial control in news channels with foreign investment, the Union Minister, Sushma Swaraj, said this would be finalised by the Ministry and notified in the guidelines shortly. News channels already having foreign investment in excess of 26 per cent will be given a year's time to bring down their foreign equity to the new limit. Besides, the Cabinet has decided to ask the Communications Ministry to streamline its policy vis-a-vis use of VSAT for broadcasting purposes in line with this change in the uplinking regime.

With Star TV's application putting the I&B Ministry in a situation it had not anticipated while opening up satellite uplinking completely in July 2000, the Ministry last year thought it best that a decision on this ticklish issue be a collective one of the Cabinet. All the other foreign-owned channels allowed to uplink from India till date primarily deal in entertainment programmes.

As part of the consultative process, the Ministry referred the matter to the Ministries of External Affairs, Home, Finance and Communications. Only the Communications Ministry favoured continuing with the existing policy. While the External Affairs Ministry advocated a 26 per cent cap, Home and Finance Ministries were open to allowing companies with 49 per cent foreign holding to uplink from India.

Closed to private players till June 1998, satellite uplinking was first partially opened through Videsh Sanchar Nigam Limited (VSNL) to Indian companies with at least 80 per cent Indian equity and Indian management control. In March 1999, all Indian broadcasting companies were permitted to uplink through their own earth stations. This policy was further liberalised in July 2000 to allow foreign-owned companies.

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