Business Saurabh Sharma Saurabh Sharma sharma.saurabh02@gmail.com Saurabh Sharma

The noose on foreign direct investment (FDI) in India has been finally loosened. In an unprecedented policy change, the government has allowed a 100 per cent FDI in the publication of facsimile or fax editions of foreign newspapers. The notification which came on 14th January also notified the 26% of FDI in the Indian editions of foreign newspapers and current affair magazines. This FDI relaxation in the media is seen as a major policy change. Especially, when the industry is highly regulated and offers but little opportunity to the foreign players. The recent announcement would help those foreign media houses who are already in the Indian market with some joint venture and want their independent presence. This will also give boost to those who want to have the proverbial slice of the booming media industry in India. An announcement issued by the ministry of commerce and industry also specified that the investment should be made by the owner of the publication. It states that the entity must set up its Indian office and should be registered under the Companies Act, 1956. But before making any foray into the Indian market, prior approval of the government would be mandatory. Dr. Amit Mitra, general secretary of Federation of Indian Chambers of Commerce and Industry (FICCI) termed this move by the government as a very positive step. “It’s a very encouraging step by the government and will surely bring competition and improve the standards the Indian media.” Suprio Guha Thakurta, managing director of The Economist in India said it as a very encouraging move. “We will do a due diligence and analysis in terms of cost-effectiveness of publishing a facsimile version in India. It is likely that the cost benefit of printing and production in India may outweigh the loss of economies of scale currently enjoyed by printing in a central location for the region. Such a move will positively impact our distribution costs, and hence is an announcement we are looking forward to,” he said. In an email Joe Spitzer, Corporate communications, Asia Pacific, Dow Jones said, “Dow Jones intends to proceed with the publication and distribution of facsimile editions of The Wall Street Journal in India. The company will announce its plans in due course”. The presence of foreign newspapers and magazines in India is not new. Currently the marketing and distribution of facsimile editions of Fortune and Time magazine is done by India Today group. For Newsweek, Outlook group provides this facility. Both India Today and Outlook group are the leading media houses in India. On the newspaper front, Mint, a business news paper of Hindustan Times Group, has exclusive partnership with Wall Street Journal. Deccan Chronicle Ltd. has ventured with The New York Time Co. to distribute the fax edition of The International Herald Tribune. But the policy is still unattractive in terms of advertisement. In the facsimile editions, publications are not permitted to carry India edition specific ads. Presently, they are only allowed to solicit advertisements for their international editions as per the regulations. If the policy be thus amended and allow the foreign publications to accept advertisements specific for Indian fax edition, this would become an attractive business proposition for them. 2009-02-21 16:05:26 UTC 2010-03-11 00:43:48 UTC