HONG KONG – A couple of new TV channels and a move to expand the Internet into rural areas were among a package of media-related measures unveiled on Thursday by India’s finance minister in the first budget of the new BJP government headed by Narendra Modi.
Finance minister Arun Jaitley styled the overall budget as a plan to return the country to growth, while also cutting government borrowing.
That is likely to mean the reduction of a number of subsidies, such as those on food and fuel, and higher taxes on cigarettes.
Indian’s economic growth has fallen to less than 5% per year, but speaking to Parliament after the budget announcements, Jaitley said that it would increase again to 7-8%. He was criticized by ratings agency Moody’s for his vagueness.
Jaitley ignored calls from the media, entertainment and communications sectors to reduce and streamline their tax burden. Instead, he showed a willingness for the federal government to continue to micro-manage parts of the media sector.
He announced that state broadcaster Doordarshan will receive INR1 billion ($16.7 million) to launch a new TV channel for farmers, and said that another new channel “Arun Prabha” would promote cultural identity in the country’s North East.
Two measures worth INR5 billion ($83 million) each will help to create a broadband network in rural areas, and promote local manufacturing of hardware and software. And there will be additional funding for some 600 community radio stations.
The e-commerce industry got a boost with more products allowed to be sold online.
But these support measures also come at a price. Advertising on the Internet and mobile will become liable to service tax, though advertising in print will remain exempted.
Jaitley announced that the Film & Television Institute of India in Pune and the Satyajit Ray Institute in Kolkata will be granted the status of “institutes of national importance.”