BOOM TIME FOR
FOREIGN TV CHANNELS
The recent amendments to Fema rules and the Andhra Pradesh
High Court decision to strike down the rule that bans political
advertisements on television, opens the doors of foreign television
companies (FTCs, that uplink from outside the country) to
political parties who wish to advertise.
The Congress, BJP, SJP and even regional
parties, who wish to reach a national audience but could not
do so due to a Fema restriction on remittances for advertisements,
can now advertise on entertainment channels like Sony, Discovery
and a couple of channels from the Zee and Star bouquet that
continue to be uplinked from Singapore and Hong Kong respectively.
Earlier, only exporters whose export earnings
was more than Rs 10 lakh for two preceding years were allowed
to advertise on these channels as the beam goes to countries
which could be their export destinations. Exporters whose
earnings were less than this had to seek approval of the Reserve
Bank of India. But with these channels grabbing a large chunk
of viewership in India, even non-exporters started advertising
on these channels by illegally buying the exporters' entitlement
to forex at a premium.
Last month, the government simplified procedures and amended
the Foreign Exchange (Compounding Proceedings) Rules, 2000.
Now, remittances for advertisement on FTCs have been allowed
without any ceiling. As a result non-exporters too can advertise.
Coming on the eve of the elections, this amendment will definitely
benefit political parties.
STAR India Pvt Ltd COO Samir Nair says: "When the market
opens up, many benefit by default. Anyway the benefit accrues
not with the ability to advertise, but with the desire to
do so. How do you know that political parties will not choose
to go to Doordarshan which also has a wide reach.
Prasar Bharati CEO K S Sarma says he would rather wait for
the Election Commission to take a view. In any case politicians
too are still watching as the EC ban is yet to be lifted,
he points out. Sony's Kunal Dasgupta and Zee's Jawahar Goel
say it is too early to comment as there have been no enquiries
as yet.
Sahara TV president Mahesh Prasad believes
that it is the news channels that political parties target.
Company's head (Sales) Monika Srivastav says all parties have
been in touch since noon Tuesday to book ads. "I expect
that the broadcasting sector will get revenues worth Rs 50-60
crore from political advertising now," she said.
