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Read The Fine Print

The long-debated FDI in newspapers and magazines is here and may have been prompted by the government's itch to teach dissenters a lesson

Read The Fine Print
illustration by Jayachandran
Read The Fine Print
In a stealthy move which caught both big media houses and the swadeshi lobby off guard, the cabinet railroaded through a proposal lifting restrictions on foreign direct investment (FDI) in the print media last week. This, despite dissent within the cabinet and protests from almost all NDA allies and Opposition parties alike. The decision also flies in the face of recommendations from the parliamentary standing committee on information technology and the Indian Newspapers Society (INS), not to mention journalists' unions.

But why did the cabinet push through the proposal in such inexplicable hurry? The simplistic explanation is that Prime Minister A.B. Vajpayee has finally yielded to pressure from a small clutch of newspaper owners starved for finances and looking towards an inflow of foreign funds. But, according to an official in the PMO, the unusual hurry was prompted by the thinking in the government that three large newspaper organisations which were very critical of the government had to be bridled and taught a lesson. Says the official: "It is not Gujarat but in other areas—defence and what have you—that these papers have been very unkind to the government. Even the good that we do is criticised. So how can they expect support from the government?" The three newspapers, The Times of India, The Hindustan Times and The Hindu, have been vigorously campaigning against the entry of FDI in the print media.

Eminent journalist Prabhash Joshi believes the move is intended to put the squeeze on the print media. "It is an attempt to quieten criticism, not just of the government but of the Sangh parivar. Big groups, which can look after themselves financially, are independent in their coverage and critical of the government and the Sangh parivar. It is to fight them that some papers (willing to toe the government line) want foreign investment." The objective is to coerce the secular press while promoting the concept of the Hindu rashtra, he says.

If feedback from the PMO is any indication, Joshi's surmise is correct. The government has been unhappy with the hostile coverage of the Gujarat riots by the major national and regional language newspapers in the country. Bulging dossiers of clippings on Gujarat have been put together, one of which is devoted to a particularly critical correspondent—along with copies of his articles reprinted in the Pakistani press. A cabinet minister cryptically remarked a fortnight ago that if the FDI was cleared, that correspondent could congratulate himself on having had a role to play!

CPI general secretary A.B. Bardhan agrees that the decision to permit FDI in print appears to be linked to the print media's coverage of the Gujarat riots. "I think it is linked to it (the Gujarat riots). It is an attempt at coercion. At the same time, it is in tune with their policies overall. They have submitted to the West in terms of economic affairs, foreign affairs and political affairs, so why not in media?" Not everyone in the anti-FDI lobby subscribes to the view that it's a politically-motivated decision. "I think it has more to do with Rupert Murdoch's covert visit to India a short while ago," observes one newspaper proprietor. It is well known that the media baron has been interested in acquiring a presence in the print media, he adds.

But despite pushing through the proposal, there is some talk of a rethink by the government. The idea, it appears, is to bring the national and regional newspapers to the negotiating table. There is hope of a rollback, senior executives in a major newspaper told Outlook. "Let us hope wiser counsel will prevail on this government which is known as a rollback government," said Eenadu proprietor Ramoji Rao in a statement last week. "We're working very quietly for a rollback.There will be a fight but we don't want to publicise our strategy just yet," said the editor of a major regional daily.

Congress spokesperson Anand Sharma says that the government has gone against the national consensus in pushing through the proposal. "Just as this government has overturned the 1955 cabinet decision, any future government can overturn this decision."

The protests which followed the decision to open the print media to FDI underlines the fact that there was no pretence at a public debate on the issue. In fact, the press and political establishment are mystified at the government's apparent desperation to push through the move in the face of near-universal disapproval—this is the third time in less than a year that the same subject has been brought to the cabinet. In the 12 years of intense debate, ever since the Narasimha Rao government decided to re-examine the 1955 cabinet decision which bans FDI in print media, it has consistently been rejected by journalists, political parties, government committees and publishers.

And, as an editorial entitled "Madness" in the Telegu daily Eenadu last week pointed out, Union information and broadcasting minister Sushma Swaraj reaffirmed her government's commitment to the 1955 cabinet decision exactly one year ago. So why the U-turn, prompted, on the face of it, by a small clutch of newspaper proprietors and editors, half of whom are in dire financial straits? No answers are forthcoming from the government. "We simply cannot understand the government's reasoning," says INS chief Pratap Pawar. "Why did the government go back on its word? Why won't it listen to its own people?"

A 26 per cent "strategic" stake in newspapers permitted by the government effectively allows the foreign investor a say in management decisions, say anti-FDI lobbyists. Besides, a 74 per cent stake in scientific, technical and speciality journals has been permitted, a provision which could be misused to funnel money to any publication, they add. But the main protests centre around national security considerations, particularly at a sensitive juncture in Indo-Pakistan relations. The media, the anti-FDI lobby points out, is not just another sector of the economy. The likely negative impact on small and medium newspapers is another area of concern. If the influx of foreign money forces the latter to close down, many journalists and support staff would lose their jobs.

Apart from the Left Front, Congress, NCP and AIADMK, the government's move has come under fire from the TDP, Shiv Sena and Samata. It is likely to figure in the monsoon session of Parliament in a big way, with the Opposition and the NDA allies joining hands to embarrass the government. Moreover, at least two constituents of the Sangh parivar—the Bharatiya Mazdoor Sangh (BMS) and the Swadeshi Jagaran Manch (SJM)—have both issued strong statements against the FDI decision.

Says BMS chief Hasubhai Dave: "The decision of the Union cabinet (to permit 26 per cent FDI in news journals) is not in the national interest. The justification for such a hasty move is not understood. While taking this decision, security considerations, long-term effects on society and its cultural impact have not been taken into consideration. It will cause harm to the nation's political, cultural and intellectual lifestyle."

Swaraj's pleas that there are adequate safeguards in place to ensure that management and editorial control remains with Indians—the top editorial staff will consist of resident Indians and three-quarters of the boards of directors will also have to be Indians—haven't found any takers. Says SJM chief P. Murlidhar Rao: "The move is unfortunate. Those who are trying to say they have taken precautions and built in safeguards know very well how little these mean in the real world of journalism."

The RSS is yet to clarify its position on the matter, with deputy spokesperson Ram Madhav pointing out that the opponents of FDI are the same people who called the RSS retrograde when it called for brakes on liberalisation. Intense lobbying is under way to convince the RSS to back the move. A decision is likely to be taken during the Kurukshetra conclave of the Sangh.

Meanwhile, publications opposed to the entry of FDI are negotiating for a rollback. If that happens, it will be for a price. The Fourth Estate will have to be far friendlier and less critical of the government.
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