In Fine Print

Chaturvedi told the India Economic Forum last fortnight that "restrictions on investment by foreign companies in the domestic print media" would be lifted, following a review of the 1955 Cabinet decision barring the entry of foreign agencies into the media.

The note on the subject, circulated by the I&B ministry, tells quite another story. The objective of the review, quite clearly, is only to legalise the current status, where technical and "niche" journals are published without the permission of the I&B ministry. Nowhere does it suggest that foreign investors will be permitted to buy into news and current affairs publications.

The note-sent to nine ministries including home, external affairs, finance and human resource development-says that the 1955 Cabinet decision must be reviewed "for the limited purpose of allowing printing and publication as textual exact replica in India of foreign scientific, technical and specialised journals/periodicals/magazines on a case-to-case basis".

I&B minister Arun Jaitley, sources say, is himself not keen on the idea of foreign direct investment (FDI) in the Indian print media. Although Jaitley was unwilling to comment, a brief note on the file-to the effect that the constitutional "right to expression" is available to Indian citizens-indicates his mindset.

The issue of allowing FDI in the indigenous print media dates back to 1989, when Parade magazine commenced publication on the strength of permission obtained from the ministry of human resource development. A committee of secretaries was formed to look into the matter. The I&B ministry protested and the magazine had to fold up after three years.

It had, however, shown the way to others looking for a backdoor entry into the Indian market. Cosmopolitan began publishing on the basis of permission from the ministry of finance. The I&B ministry protested, pointing out that permission had been given by the finance ministry on a royalty basis- applicable to books and not magazines.

The latter responded by giving similar permission to Elle under a syndication arrangement. Then it politely suggested that the I&B ministry take a "fresh view" on the matter.

Recognising the wisdom of this suggestion, the note observes: "The I&B ministry has been taking an extremely rigid stand on each and every request for a foreign tie-up...in the meantime, different ministries have given permission to different periodicals and journals on their own, without taking the I&B ministry into confidence. It is, therefore, felt that the rigid position of the ministry needs to be corrected and re-adjusted in the given circumstances."

The 1955 Cabinet decision does have a loophole in that it prohibits publication of foreign newspapers/periodicals in India and Indian editions of foreign newspapers/periodicals dealing mainly with news and current affairs. It was by taking advantage of this loophole that an Indian edition of jama-a medical journal-was published. The I&B ministry consulted the law ministry which said that whether or not Indian editions of foreign periodicals not dealing with news are allowed was a matter of interpretation.

In the first flush of liberalisation, a ministerial committee headed by N.K.P. Salve recommended that requests from the Indian print media for tie-ups with foreign publications be taken up on a case-to-case basis. However, the following year the Anand Bazar Patrika group was denied permission for an Indian edition of the Financial Times.

Recently, the I&B ministry had gone to great lengths to create the impression that it was welcoming foreign equity in the print media, with Chaturvedi saying that the 1955 Cabinet decision was taken at a time when the domestic print media needed protection and that the situation had now changed. Even proprietors were no longer opposed to the entry of foreign investors, he said.

However, nothing commensurate has been put down on paper. This has fuelled speculation that the motive might have been to assess reactions to the proposal before going ahead with it. Apart from bolstering the government’s pro-liberalisation image, it would have sent warning signals to newspaper proprietors, some of whom are protectionists on the grounds that they would be badly hit by foreign competition. Will the foreign clouds be finally blown away?