Ravi Shankar Prasad

New Delhi, Feb. 14: The ministries of home and external affairs are in favour of limiting the direct uplink facility to television news channels that are run by Indian-owned companies. This will have direct consequences for STAR News, which is 100 per cent foreign-owned but wants to uplink its news channel from India.

In response to a note circulated by the Union information and broadcasting ministry after Rupert Murdoch’s STAR News applied for permission to uplink for its soon-to-be-launched news channel, the home ministry said it wants the facility to be restricted to companies where foreign equity holding will be at a maximum of 49 per cent.

The ministry of external affairs has, in its reaction, favoured a lower cap on foreign equity holding at 26 per cent — on a par with the news and current affairs category in the print media where foreign direct investment (FDI) is allowed at the same level.

The telecommunications ministry has favoured status quo. In other words, it does not see the rationale in distinguishing between news channels that are Indian-held and those that are foreign-owned.

The I&B ministry had sought the response of the Planning Commission, too. The commission is understood to have refrained from commenting on the equity holding but has insisted that the management of the news channels should vest with Indians.

The I&B ministry had circulated the note in October 2002 after STAR News’ application. Subsequently, CNBC India, too, applied for permission to uplink.

The note was prepared when Sushma Swaraj was I&B minister. Ravi Shankar Prasad, who now holds the portfolio, is understood to have listed the matter as top priority. But the minister is busy campaigning for the Assembly elections.

Prasad has said — like Swaraj before him — that he will brief the Cabinet and seek its advice before the ministry formulates its policy.

The note said the government could consider granting permission to foreign channels on the basis of its policy for allowing FDI in print media.

It outlined four options — limited FDI in news channels to 26 per cent (on a par with the print media), or to 49 per cent (comparable to the existing policy of allowing FDI up to 49 per cent in the cable and direct-to-home companies). A third option was to bar foreign companies from uplinking altogether and the fourth was to maintain status quo.

Since there is nothing in the existing guidelines on uplinking that debars foreign channels from seeking permission, this would mean that the Centre does not feel STAR’s application merits a new policy statement.