US embassy cable - 05NEWDELHI4312

C O N F I D E N T I A L SECTION 01 OF 04 NEW DELHI 004312 
 
SIPDIS 
 
FOR SA/PPD LSCHWARTZ, G/TIP MARK TAYLOR 
 
E.O. 12958: DECL: 06/08/2015 
TAGS: KPAO, PGOV, PINR, IN, Indian Domestic Politics 
SUBJECT: INFORMATION MINISTER JAIPAL REDDY UPBEAT ON MEDIA 
 
REFORM 
 
REF: NEW DELHI 4232 
 
Classified By: Charge Bob Blake, for Reasons 1.4 (B, D) 
 
1.  (C) Summary: Meeting with the Charge and the PA Minister 
Counselor in New Delhi on June 7, Minister for Information 
and Broadcasting Jaipal Reddy was upbeat and optimistic about 
the prospects for further liberalization of the media sector. 
 The purpose of the Charge's call was to get the Minister's 
views on several pending and controversial media policy 
issues.  Reddy pointed out that he had "brought the Left 
along" and opened up India for foreign publications, foreign 
broadcasters and FDI in Indian media.  At the same time, he 
added a note of caution, pointing out that the Indian 
political environment does not permit rapid change, 
especially on issues such as permitting private FM stations 
to broadcast news.  Reddy also emphasized the power of 
India's public sector broadcast media in influencing public 
opinion on crucial issues such as HIV/AIDS and trafficking in 
persons, and welcomed any assistance the US can provide to 
produce further spots.  He all but confirmed that he would 
soon be leaving the Ministry and returning to Congress Party 
headquarters duties in support of party President Sonia 
Gandhi.  End Summary. 
 
The Indian Film Industry 
------------------------ 
 
2.  (C) Having just returned from the Cannes Film Festival, 
Reddy began the conversation with the observation that he was 
disappointed that "Indian films were not appreciated," noting 
that not one Indian film was selected by the jury for 
competition.  He further noted that Bollywood actress 
Ashwarya Rai attended the festival, but was there to endorse 
a product rather than promote Indian cinema.  Reddy and the 
Prime Minister had just seen the Indian film "Bose," about 
the Indian independence leader, saying it was "historically 
accurate," and handled the "controversial aspects very 
delicately," such as pointing out the Bose had embarked on a 
"great venture," when he formed the Indian National Army 
(INA), but was "intellectually bankrupt." 
 
The Big Media Issues 
-------------------- 
 
3.  (C) The Charge asked the Minister whether foreign 
publications, such as "the International Herald Tribune" will 
be allowed to publish in India.  Reddy replied that 
"facsimile editions" of any foreign publication will be 
allowed in India, even when they are "100 percent foreign 
owned" and have no Indian partner, although they will not be 
allowed to contain Indian content or advertising.  He said 
this meant the "International Herald Tribune," which is being 
printed by a Hyderabad publisher, will be allowed to continue 
to operate.  Indian editions of foreign publications will 
also be allowed, but must change their masthead to reflect 
they are being published in India.  The foreign investment 
restrictions on such publications have also been increased 
from 7.5 percent to 20 percent, while allowable "syndication 
content" has been increased from 7.5 percent to 20 percent. 
If news agency material is counted, foreign content would 
actually go as high as 40 percent.  Such editions will be 
allowed to accept Indian advertising and publish local 
content. 
 
4.  (C) Reddy cited the example of the pending request from 
the "Wall Street Journal" to publish in India.  Under the new 
regulations, the WSJ could publish an Indian edition under a 
changed masthead such as "The Indian Wall Street Journal," as 
long as 51 percent of the equity was held by Indians. 
Foreign content in such publications will be restricted to 40 
percent of the total.  Reddy assured the Charge that both 
"Business Week" and "Fortune" -- two other US news 
publications which have shown interest in entering the Indian 
market -- could publish in India without problems, provided 
they met the soon-to-be revised more liberal regulations. 
 
5.  (C) Reddy was proud that he had "brought the left along," 
and convinced them to accept these foreign news publication 
changes.  He had pointed out to Communist leaders that 
foreign publications have never been "banned" in India, and 
they accepted his argument.  The Left leaders were also 
concerned that foreign publications could pose a threat to 
Indian publications and possibly drive them out of business. 
Reddy was emphatic that "reforms are more genuine when the 
Left is carried along." 
 
6.  (C) Reddy noted that the same restrictions would apply to 
US magazines, although hundreds of foreign journals deemed to 
be "scientific, technical and specialty" publications are 
published in India without restriction.  It was noted that 
the "India Today" group has just launched an Indian edition 
of "Scientific America." 
 
Radio and Television 
-------------------- 
 
7.  (C) The Minister was very upbeat about the future of 
commercial FM radio in India, saying that in the next several 
weeks approximately 330 new FM stations would be licensed to 
start broadcasting in the private sector (there are about 20 
now).  He was much less sanguine about private radio stations 
being allowed to air their own news, however, saying that 
there is genuine concern across India's political spectrum 
regarding "cross media restrictions."  In this regard, he 
pointed out, radio is much more sensitive than television, as 
the common man relies more on radio.  India's leaders are 
reluctant to see the emergence of powerful media 
conglomerates, such as the "Times of India" and "India Today" 
groups, that would incorporate radio, newspapers, and TV 
stations. 
 
8.  (C) Reddy pointed out that the reach of Indian private 
media is "phenomenal," but implied that many in the media 
could be irresponsible.  During the 2004 Parliamentary 
election campaign the media was "raucous," predicting that 
the BJP-led NDA would sweep the nation and establish a one 
party rule and even concocting partisan polls and surveys to 
back up their assessment of a Congress defeat.  The NDA's 
defeat was therefore the media's defeat.  This has resulted 
in opposition to news reporting on FM radio that is supported 
by parties from across the political spectrum.  Reddy was 
able to lift the FDI in FM radio to 20 percent with the 
assent of the Communists, however. 
 
9.  (C) The Charge pointed out that there has been a rapid 
expansion in the number of television channels on cable in 
India, and that foreign broadcasters, including Rupert 
Murdoch, wanted to begin commercial broadcasting on free to 
air, which is currently controlled by Doordarshan (DD), the 
government's national television network. 
 
10.  (C) Reddy replied that every country must take its 
"media sensitivities" into account when making such 
decisions, so as to avoid charges of "cultural imperialism," 
such as those leveled by France and other countries against 
the US.  He noted that the US had required Murdoch to become 
a US citizen in order to comply with its media ownership 
regulations.  Reddy insisted that progress is being made on 
this front in that there are now Direct-to-Home (DTH) 
licenses for three private and one public station, (DD).  The 
latter was offering a mix of channels through decoders and 
hoped to wire 5 million homes within the next several months. 
 He noted that BBC broadcasts were now available free of 
charge to Indians on DD. 
 
Indian FCC 
---------- 
 
11.  (C) In response to a question from the Charge, Reddy 
said he would introduce a bill in the next session of 
Parliament to establish an Indian version of the FCC to 
regulate technical issues and content in television 
broadcasting.  He was confident that the measure would pass 
easily as "there is no opposition."  Reddy plans to establish 
a "truly autonomous" Commission patterned after the Press 
Council of India and headed by a retired Supreme Court Judge. 
 Reddy maintained that many in India do not believe that 
autonomous institutions are possible and have criticized him 
for being overly optimistic.  The Charge offered to assist 
Indian experts interested in the FCC once the Commission is 
up and running. 
 
HIV and TIP 
----------- 
 
12.  (C) The Charge thanked Reddy for the great strides made 
in broadcasting public service announcements regarding HIV 
and Trafficking in Persons.  The Minister replied that the PM 
was fully supportive of these efforts and that his backing 
had made the difference.  He also praised the private sector 
for its interest in these issues.  The problem, Reddy noted, 
is not finding air time for such messages, but producing 
messages of sufficient quality.  He opined that "there is 
great hypocrisy in India regarding sex," and that hypocrisy 
is the real problem.  Reddy hopes to produce spots with 
well-respected world leaders like Kenneth Kaunda, Kofi Annan, 
and Bill Clinton, and welcomed any technical assistance the 
USG or US companies could provide to help produce quality 
public service announcements on trafficking in persons. 
 
Public Broadcasting 
------------------- 
 
13.  (C) The Minister pointed out that the influence of 
public broadcasting has been "underestimated" in India, where 
only 45 percent of televisions have access to cable.  Saying 
"we have a captive audience" which does not have the 
purchasing power of those watching the cable channels, but is 
the group most affected by HIV and trafficking.  Only 
Doordarshan can reach these audiences, but quality remains 
the problem, as the messages have to be appealing to have a 
positive impact.  The Charge pointed out that the USG has 
worked on such messages with other countries and has come up 
with some good spots, and that he was confident that we could 
do the same thing in India.  The Minister singled-out 
American actor Richard Gere for his work in India on HIV/AIDS 
awareness. 
 
Advani and the BJP 
------------------ 
 
14.  (C) Reddy opined that Advani's fate is not so much a 
matter of Indian public debate as a matter of debate within 
the Sangh Parivar (the Hindu family of organizations).  In 
Reddy's view, Advani was already becoming marginalized and 
his remarks in Pakistan (Reftel) had only accelerated his 
ongoing marginalization.  Noting that the BJP has no strong 
contender to replace Advani, Reddy predicted that the next 
President would not emerge from the ranks of the current BJP 
leadership but would be a "dark horse."  Reddy maintained 
that the BJP will not be able to compete politically as long 
as it embraces Hindutva (Hindu nationalism), and must adopt 
the "neo-secularism" being advocated by Advani, or it will 
continue to suffer at the polls.  He suggested that the NDA 
could "break up," if it fails to find a "face saving device" 
such as that provided by former PM Vajpayee that allows 
secular parties to cooperate with the Sangh Parivar.  He 
concluded that Congress was "comfortable" about current 
developments. 
 
The Cabinet Shake-up 
-------------------- 
 
15.  (C) While he would not discuss the future make-up of the 
Cabinet after what most assume will be a shuffling of 
portfolios in the next few months, Reddy confirmed that he 
was not happy with his current portfolio, as he does not have 
sufficient flexibility to take substantive steps.  However, 
since there are no other portfolios available for him, Reddy 
implied that he would be returning to his old job as Sonia 
Gandhi's personal spokesman. 
Comment 
------- 
 
16.  (C) Although his days as a Cabinet Minister are 
apparently numbered, Reddy forcefully reassured us that the 
UPA government was interested in further slow, but steady 
liberalization of Indian media and was receptive to more 
foreign investment in publications and broadcasting.  He also 
tried to put a note of realism into the debate, however, by 
pointing out that the GOI's intentions are correct but it is 
constrained by India's political environment and the constant 
need for compromise.  His message was that change will come, 
but it will not be quick or dramatic.  Reddy seemed excited 
by the prospect of returning to the Sonia Gandhi inner circle 
and was upbeat about the current political situation.  Like 
many within Congress, he is happy to sit on the sidelines and 
watch the BJP consume itself in internal conflict. 
BLAKE