Regulators

DPIIT to issue clarification on capping FDI in digital media

Some stakeholders raise concern over government’s decision to allow 26 per cent FDI

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MUMBAI: Amid certain stakeholders raise concern over government’s decision to allow 26 per cent FDI in digital media sector, the Department for Promotion of Industry and Internal Trade (DPIIT) is likely to issue a clarification soon on the same, Economic Times reported.

According to some stakeholders, the idea to cap FDI (foreign direct investment) in digital media sector to 26 per cent must be clarified  by government as these stakeholders, who were looking to raise funds through FDI is now put on hold.

There are two main concerns stakeholders have raised and sought clarification: 1) How the FDI policy of the sector would treat news aggregators, and 2) what would happen to those digital media companies where overseas investment is over 26 per cent

Taking the views of the Information and Broadcasting Ministry on the issue, the DPIIT is expected to issue clarification shortly, Economic Times said quoting sources.

In this regard, Deloitte India partner Jehil Thakkar had said that the clarity needed was on how to treat cases of television broadcasters that stream news online, but are allowed 49 per cent FDI.

He questioned, “What happens to those, whether they qualify fewer than 26 per cent or 49 per cent (FDI)? What happens to news websites which are 100 per cent foreign entity?”

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