Though 100 percent FDI is already allowed in non-news media like a trade publication and general entertainment channel, the Government is mulling over the proposal for increased FDI in news media for quite some time. What difference would an increase in FDI make? Critically evaluate the pros and cons.

Currently, 26% FDI is allowed in news media, and the government has tabled a proposal to increase it to 100%. Increase of FDI to 49% would ensure that ownership of the media company would still be Indian hands, but 100% FDI would allow wholly foreign-owned companied to function in India. Considering the fact that news is a sensitive issue, it will hold various implications and repercussions for the news media industry.

Since dissemination of news is integral to the security of the nation, and it plays an important role in the education of its people, it would be ill-advised to leave control of news entirely to foreign owned and controlled companies. Control of news by foreign companies could lead to biased reportage, promotion of controlling organisation’s agenda and objectives, differences in journalistic standards and practices are all worrisome issues. Also, entering of foreign conglomerates could adversely affect the domestic players, especially the regional media organizations. However, on the flipside, large news companies could help infuse new technology and increased resources in the sector, and bring it up to global standards. Also, the entrance of well-established news organizations could increase competition and thus, improve quality of services provided.

Topics: GS-III: Economic Growth Development