Cabinet approves Rs 784.87 cr e-auctions for 730 FM radio channels across 234 new cities

The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the proposal for the 3rd batch of ascending e-auctions for 730 FM radio channels in 234 new cities, with an estimated reserve price of Rs. 784.87 crore under the Private FM Radio Phase III Policy.

According to the official statement, the Cabinet also approved a proposal to set the Annual License Fee (ALF) for FM channels at 4 per cent of Gross Revenue, excluding Goods and Services Tax (GST). This will apply to the 234 new cities and towns.

The expansion of Private FM Radio to these 234 new locations will address the existing demand for FM radio services in areas still uncovered by private broadcasters, providing access to new and local content in regional languages.

This initiative will create new employment opportunities, promote local dialects and culture, and support the 'vocal for local' initiative.

Many of the approved cities and towns are located in Aspirational districts and areas affected by Left-Wing Extremism (LWE). The introduction of Private FM Radio in these regions will further strengthen the Government's outreach efforts.

The evolution of India's Private FM Radio Policy marked a shift from Medium Wave (MW) broadcasting to Frequency Modulated (FM) waves, driven by a need to enhance the quality and variety of radio programming, improve broadcast standards, and modernize outdated equipment.

The journey began with the approval of the FM Phase-I Policy in July 1999, which aimed to revitalize the radio industry by introducing open auctions for selecting successful bidders. However, the initial phase met with limited success, with only 21 channels becoming operational across 12 cities.

Recognizing the need for a more robust framework, the government introduced the improved FM Phase-II Policy in July 2005, following recommendations from the Dr Amit Mitra Committee and the Telecom Regulatory Authority of India (TRAI).

This policy was well-received by stakeholders and resulted in significant growth in the FM radio industry, creating new employment opportunities and expanding the reach of private FM radio. Despite this success, many cities, particularly those with populations below three lakh and border areas, remained outside the private FM radio network.

The necessity for further expansion led to the introduction of the FM Phase-III Policy, which sought to address the unmet demand for FM radio in uncovered cities.

This policy recognized the strategic importance of extending FM radio services to border areas, such as Jammu & Kashmir, the North Eastern states, and island territories, where private broadcasters had been reluctant to enter due to concerns about viability.

The policy also aimed to incentivise the development of FM radio in these regions to counter cross-border propaganda and ensure that Indian radio channels had a wider reach.

Additionally, the Phase-III Policy acknowledged the presence of 97 vacant channels from Phase-II that could not be auctioned for various reasons and emphasized the need for better utilisation of the frequency spectrum allocated for FM broadcasting.