TRAI releases consultation paper on FDI in broadcast sector

Broadcast sector regulator TRAI, which has been asked by the I&B ministry to examine the Foreign Direct Investment (FDI) limits in broadcast sector, today released a consultation paper seeking the views of stakeholders on the issue.
In the paper, TRAI said FDI, apart from being a source of equity investment, also brings benefits like transfer of technology, strengthening infrastructure, enhancing competitiveness and generating employment.
TRAI said while making recommendations on the subject of FDI in broadcasting, the growing convergence between broadcasting and telecom sectors has to be recognised.
In the consultation paper, TRAI said broadcasting services can be grouped into carriage services and content services.

It said currently, the FDI limit in carriage services is 74 percent, of which 49 percent is permissible through the automatic route. Any FDI beyond 49 percent has to go through the FIPB route.
The same FDI limits and approval route were prescribed for broadcast carriage services and telecom services on the ground that both are infrastructural services akin to each other and there is a growing convergence between the broadcasting and telecom infrastructures.
The government is contemplating enhancement in the FDI limit for telecom services to 100 percent with FDI up to 49 percent through the automatic route and FDI beyond 49 percent through FIPB.

Carrying the same logic forward, the same limits and route ought to be made applicable to the carriage services in the broadcasting sector, TRAI said in its consultation paper.