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Foreign Publishers Move Into India - 2004-06-20

For the first time, The International Herald Tribune is being printed in India. But the project is embroiled in controversy.

For Indian readers, it is a first-time experience, picking up a foreign newspaper in India on the same day it is published overseas. It became possible two weeks ago, when The International Herald Tribune began printing in the southern city of Hyderabad.

For decades, India banned foreign ownership of domestic publications. But the publishers of the Paris-based International Herald Tribune took advantage of the fact that there is no law barring foreign newspapers from being printed in the country.

Authorities were caught off guard when the newspaper hit Indian newsstands, and have asked it to stop publication. The newspaper's Indian editors have refused, saying they are breaking no law.

The government is now contemplating enacting legislation that would require foreign newspapers to get permission before being printed locally.

Media analyst Sevanti Ninan says the government is unlikely to take a hard stand on the issue.

"If you have international channels, if you have world space radio, and India is part of a globalized media market, then why should you keep out foreign newspapers?" he said.

Other foreign newspapers are also eying the Indian market, taking advantage of the fact that in 2002 the government allowed foreigners to take stakes of up to 26 percent in print media companies.

As a result, Dow Jones, a U.S. company, has allied with a local media group, and plans to launch an Indian version of its flagship publication, The Wall Street Journal, this year. The publisher of Britain's Financial Times has also entered into a partnership with an Indian daily. The projects to print Indian editions will have to be approved by the government.

India is the world's second largest newspaper market. More than 70 million newspapers were sold in India daily in 2003, next only to China.

Foreign newspapers in India will target high-end readers. The International Herald Tribune sells for 65 cents, more than 10 times the cost of most Indian newspapers. Sevanti Ninan says these journals want to grab a slice of a potentially huge market in a country of a billion-plus people.

"You may not find it lucrative in the short term," said Mr. Ninan. "But it will be worth it in the long-term, because it is an English-speaking, future market. Nowhere else in Asia are you going to get such an enormous English-speaking market."

Newspapers focused on business and financial news are expected to do well, as India's economy expands and integrates with the global economy.