Government might revive SUUTI

Dwindling revenue from divestment prompts move, with Cabinet discussion possible this week; on TV rating guidelines too

Trying hard to shore up its revenues to meet the year’s fiscal deficit target, the government is likely to revive Specified Undertaking of Unit Trust of India (SUUTI). A proposal to this effect might come before the Cabinet later this week.

The Cabinet Committee on Economic Affairs (CCEA) might also discuss a proposal to increase the import duty on refined vegetable oils from the current 7.5 per cent to 10 per cent. And, the Cabinet is likely to consider the policy guidelines for television rating agencies.

To revive SUUTI, the government will have to defer a decision of 2012 to wind up the company and transfer its assets and liabilities to a new one. It was earlier decided that the Rs 40,000 crore of SUUTI assets (through it, the government held stake in ITC, Larsen & Toubro and Axis Bank) would be transferred to an asset management company (AMC). The latter was to leverage the assets to raise resources for the government.

ON CABINET AGENDA

SUTTI

• Govt will have to defer 2012 Cabinet decision to wind up SUTTI
• Revival of SUUTI will help govt sell stakes in ITC, L&T and Axis Bank
• Earlier plan was to transfer Rs 40,000-crore worth assets of SUTTI to an asset management company
• Reviving SUTTI will help government bypass Cabinet nod to sell shares held by proposed AMC

Vegetable oil

• Higher import duty on refined vegetable oils to help increase domestic oilseed crushing
• Bring down unrestricted imports

TV rating agency

• Agencies to registered with broadcasting ministry
• Registration fee of Rs 10 lakh and bank guarantee of Rs 1 crore required
• Minimum sample size of surveys 20,000 households
• TV rating agencies to be penalised in case of wrongdoing

Now, the government wants to revive SUUTI so that it can sell stakes in these private companies. The Budget had targeted to raise Rs 14,000 crore through sale of stake in non-government companies, besides Rs 40,000 crore through disinvestment in government ones. So far this financial year, the government has raised only about Rs 3,000 crore from disinvestment. And, the fiscal deficit has already touched close to 94 per cent of the entire year’s Budget Estimate in only eight months.

Officials said the import duty on refined vegetable oils is being raised to boost domestic oilseed crushing and bring down unrestricted import.

The guidelines for television rating agencies, mooted by the information & broadcasting ministry, said all TV rating agencies will have to be registered with it. For this, companies will have to pay a registration fee of Rs 10 lakh and produce a bank guarantee of Rs 1 crore. The minimum sample size for such surveys should be 20,000-50,000 households, a senior official said. The proposal includes penal provisions for TV rating agencies.

According to officials in the sector, the move could cost TAM Media Research, the only agency in India currently measuring viewership data, an additional Rs 200-300 crore. The agency spends about Rs 2lakh per panel home.

Television ratings often influence the content and programmes produced for viewers and their accuracy is important; it directly impacts resources allocated by broadcasters for producing content.

Three years earlier, a panel of the Federation of Indian Chambers of Commerce and Industry suggested the size should be 30,000 panel homes and the industry should provide funding of Rs 660 crore to TAM.

The Telecom Regulatory Authority of India (Trai) had suggested panel homes be selected from a pool. In addition, the regulator had recommended restrictions on substantial equity holding of 10 per cent or more between rating agencies, broadcasters, advertisers and advertising agencies.

Trai also recommended the data generated by the rating agency be made available on a paid basis to all the stakeholders interested, in a transparent and equitable manner.