Cable & DTH ops fail to get sops from Govt for pushing digitisation

NEW DELHI: In what comes as a major setback to the cable TV and direct-to-home (DTH) operators, a government panel has decided not to offer any financial incentives for pushing ahead digitisation in the country.

Holding that the government has more important programmes for which it needs scarce resource, the Department of Revenue has rejected the sops sought by the industry, with barely four months to go before the deadline for the first phase of digitisation.

The Committee of Secretaries rejected the financial incentives as the Department of Revenue has expressed "reservations‘‘ about the fiscal incentives that the Information and Broadcasting Ministry had proposed.

The Government feels the flagship programmes and welfare schemes are more important than digitisation.

Cable Operators Federation of India President Roop Sharma said that the onus now lies on the I&B Ministry - which had fixed the digitisation deadlines - to ensure that the ‘digital addressable systems’ do not become ‘defective’, ‘disputed’ or ‘dead’ addressable systems, endorsing the view expressed by a cable operator from Goa, Richard Da‘Costa.

However, the Committee is understood to have agreed on an increase in foreign direct investment from 49 per cent to 74 per cent for all carriageways that are making the transition from analogue to digital system, be they cable operators or DTH platforms. This recommendation had earlier been endorsed by the Telecom Regulatory Authority of India (Trai).

The I&B ministry had proposed giving tax holidays and customs concessions, particularly since most of the set-top boxes (STBs) are being imported. Earlier, the Confederation of Indian Industry had supported the demand that the cable industry had demanded the status of being classified as an "information infrastructure‘‘ industry.

But the CoS was of the opinion that waiver of customs duty may discourage indigenous STB manufacturers.

The CII had earlier estimated an expenditure of Rs 250 billion to digitise 90 million cable homes in the next three years. It had, therefore, recommended a tax holiday for three years.

India‘s cable TV infrastructure is set for complete digitisation by the end of December 2014 and the four Indian metros (Delhi, Mumbai, Chennai, and Kolkata) by 30 June this year.

CII had said all service providers who set up a digital addressable distribution system before the sunset date to be notified in stages over a three-year period should be treated at par with Telecom Service Providers and be eligible for income tax holiday from 1 April 2011 to 31 March 2019.

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