The Secretariat for Industrial Assistance has banned all foreign direct investment (FDI) proposals in the information and broadcasting sector until a comprehensive broadcasting law is in place.
This implies that foreign direct investment proposals worth millions of dollars, including the expansion plans of Sony Entertainment Televi-sion and STAR TV as well as fresh proposals to enter the electronic media sector in India, will be held up indefi-
The enactment of the Broadcast Bill might take a long time as the government is scheduled to merely introduce the bill in Parliament for debate this week, just before it adjourns for the monsoon session.
A note issued recently by the industry ministry states: Since the new broadcasting law/policy is presently under review by the information & broadcasting ministry, it has, therefore, been decided that applications for foreign investment in respect of any aspect of broadcasting will be entertained by the FIPB only after the new policy is announced by the government.
Meanwhile, four proposals by broadcast companies have already been put on hold by the industry ministry, despite the recommendation of the I&B ministry for their clearance.
These proposals include a bid by media baron Rupert Murdochs flagship company, NewsCorp, to set up an Indian subsidiary as well as Sony Pictures move to set up its post-production and dubbing operations in the country.
NewsCorp had proposed to invest upto $15 million within five years to establish a state-of-the-art software production centre for generating television programmes, which would be used by Murdochs group companies worldwide.
All these proposals have been pending with the FIPB since last year, awaiting comments from their nodal ministry, information and broadcasting, which had refused to clear them.
However, inspite of a recent clarification by the I&B ministry approving these projects, the industry ministry has decided to hold them back on the ground that their clearance will be subject to the new broadcast bill.
Interestingly, I&B minister Jaipal Reddy had told Business Standard last Sunday that the bill will be referred to a Parliamentary committee for further debate. This effectively implies that all future proposals in this sector will be on hold for an indefinite period.