The Hindu : Duty on import of set-top boxes reduced

Online edition of India's National Newspaper
Friday, May 30, 2003

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Duty on import of set-top boxes reduced

By Our Special Correspondent

NEW DELHI MAY 29. The Finance Ministry today bailed out the Information and Broadcasting Ministry by slashing the customs duty on the import of Set-Top Boxes (STBs) — needed to access television pay channels under the Conditional Access System (CAS) — with the proviso that the revised duty regime would be effective till July 31 only.

Having secured this concession from the Finance Ministry, the I&B Minister, Ravi Shankar Prasad, said it was now the turn of the Governments of Delhi, Maharashtra, Tamil Nadu and West Bengal to act in the consumers' interest and bring down the sales tax on STBs which ranges from four to 12 per cent.

Though the Minister later clarified that CAS should not be politicised, his advocacy for a reduction in sales tax was almost thrown as a challenge to the State Governments concerned; the Congress-ruled States in particular. Referring to the Delhi Chief Minister, Sheila Dixit's letter to him vis-a-vis the CAS, Mr. Prasad said: "The Government of India has done its duty; now it is for the Government of Delhi to do its bit as far as sales tax is concerned.''

The 45 per cent reduction in customs duty on STBs came as a major relief to the I&B Ministry which has been under tremendous pressure over the past fortnight to defer/roll back the implementation of CAS in the four metropolises of Delhi, Mumbai, Chennai and Kolkata from July 15. As for the Finance Ministry's decision to limit the revised duty regime to imports made till July 31, the Minister said this had been done to protect indigenous production of STBs, expected to begin by the year-end.

Mr. Prasad said the "drastic reduction" would bring down the price of STBs which had become a major cause of concern for the consumers. In view of the concerns expressed in various quarters, the Prime Minister last Saturday instructed the Ministry to ensure that the CAS regime was "customer-friendly".

About the other misgivings pertaining to CAS, the Minister said the cable operators would have to provide a mix of programmes in the basic tier featuring free-to-air (FTA) channels. "If (the) cable operators do not provide a proper mix of programmes, they can be arrested without warrant."

Though the Government has specified that the basic tier should carry a minimum of 30 FTA channels for Rs. 72, cable operators were free to show up to 70 FTA channels for the same amount, Mr. Prasad said; once again urging all stake-holders to ensure a successful transition to CAS.

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