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NEW DELHI, Oct 1 (Reuters) – India is considering raising the cap on foreign investment in direct-to-home (DTH) satellite television operators to 74 percent from 49 percent now, a senior government official said on Wednesday.
DTH serves a small portion of the Indian television audience, and research firm Media Partners Asia forecasts the sector will expand to 25 million subscribers by 2012.
“That is being discussed,” Uday Verma, additional secretary in the ministry of information and broadcasting, told reporters at an industry conference of the proposal, without elaborating. Verma said the ministry may also reduce the revenue DTH firms have to pay the government.
Shares of DTH operator Dish TV extended gains after the news to rise 4.2 percent, and were 2.2 percent higher at 27.70 rupees in afternoon trade.
Telecoms firm Reliance Communications , state-owned Prasar Bharti, Sun TV and a venture of the Tata Group and News Corp compete in the DTH market in India.
Firms have to pay 10 percent of their annual gross revenue to the government but have been asking for that to be reduced to 6 percent of adjusted gross revenue (AGR), which is the revenue they get from broadcasting operations alone.
The firms’ stance was upheld by the sector tribunal and Verma said the government was studying the judgement. (Reporting by C.J. Kuncheria, Editing by Mark Williams)