Policy Regime:

The Government is contemplating enhancement in the FDI limit for telecom services to 100% with FDI up to 49% through the automatic route and FDI beyond 49% through FIPB. Carrying the same logic forward, and keeping in mind the fact that the ongoing digitization of the cable TV services in the country would give a big impetus to the convergence of the broadcasting and telecom infrastructures, the same limits and route ought to be made applicable to the carriage services in the broadcasting sector. We however hasten to add that even though in September 2012 the FDI regime for Broadcast carriage services has been liberalized and the caps have been increased from 49% to 74%, for all carriage and distribution platforms including direct-to-home (DTH), head-end in the sky (HITS), multi-service operators (MSOs) and cable TV, there is hardly any funding that is coming in from abroad. The reason is that prospective investors who would like to take a stake in India’s broadcast carriage services are wary of the restrictions on vertical integration presently in place for platforms like DTH, HITS and IPTV in India.