I&B ministry has its hands full trying to regulate satellite TV channels

Television channels are coming up in India at a mind-boggling rate—there’s a launch of a new channel almost every week. But regulating these channels is turning out to be a tough, if not impossible, task

The Ministry of Information and Broadcasting (I&B) has asked all TV channels to provide details of their respective Wireless Planning & Coordination (WPC) licenses by 11 June 2010. WPC licenses are issued to satellite channels when they are given the authorisation to broadcast. According to estimates, there are 512 channels which beam into the country’s households on a daily basis. Sources close to the matter say that almost 100 applications are waiting for clearance for additional channels. India must be the country that has the maximum number of satellite television channels in the world—which is proving to be a regulatory nightmare.

In 2009, the minister for information & broadcasting, Ambika Soni, had written to the Telecom Regulatory Authority of India regarding the breakneck speed of proliferation of TV channels across the country, due to issues like excessive spectrum utilisation. On 18 January 2010, the ministry had reiterated its concerns over the mushrooming of channels saying in a note: “The spectrum and transponder capacities for satellite TV channels are not unlimited.”

This is not the I&B ministry’s first diktat. Earlier, it had issued a notice to all satellite TV channels on 25th March seeking details on their WPC licences, asking them to reply within 15 days. Sources close to the matter confirmed to Moneylife that a number of channels did not respond, so the ministry was forced to extend its deadline and issue a fresh diktat on 11th June.

We tried repeatedly to get through to the ministry on this issue, but neither the minister nor any of her staff could be reached. The I&B ministry’s website also does not give any details on which satellite channels have not responded with the requisite details.

Despite being in the business of ‘information’, none of the satellite channels have responded to our queries till the time of writing this report.

Professor Priya Raj, professor of marketing consulting from the Asia Pacific Institute of Management, New Delhi, told Moneylife, “The main idea of the ministry is to look at the validation of these (WPC) licenses. It is quite logical because there are channels that have kept their documents on hold for various reasons and are sitting on them. The ministry has to keep a tab on which licenses are in use or not in use, to clear pending applications.”   

Is this another case where companies are openly flouting rules because of the absence of a regulator specifically for the satellite industry? Is the ministry at Shastri Bhawan just another toothless tiger?

And why cannot TV channels respond to such a simple issue—does it require an application under the Right to Information Act to get these details?


Coal India’s Rs12,000-crore IPO likely in September

"We had planned to bring the CIL IPO by July or August. But it could come in September also. We will bring the issue when conditions are good," coal minister Sriprakash Jaiswal said

Indicating that the initial public offering (IPO) for Coal India Limited (CIL) could be postponed beyond August, the government today said that it will wait for good market conditions to launch it, reports PTI.

"We had planned to bring the CIL IPO by July or August. But it could come in September also. We will bring the issue when conditions are good," coal minister Sriprakash Jaiswal told reporters in New Delhi.

"Coal India will file its Draft Red Herring Prospectus (DRHP) by the month-end. We will definitely bring the CIL IPO," Jaiswal added.

Mr Jaiswal had earlier said that the government could mop up over Rs12,000 crore through the CIL issue.

The government is looking at divesting 10% of its equity through the IPO. At present, the Centre owns 100% equity in CIL.

The Union cabinet is yet to clear the proposal. Some left-wing trade unions have also been opposing the proposed sell-off.

On using imported coal prices as the benchmark for domestic coal, the minister said, "We have no such plans (as of now)."

However, Mr Jaiswal had said last week that "in the recent price revision exercise, efforts have been made to price higher grades of non-coking coal of Eastern Coalfield Ltd closer to import parity price...it needs to be carried further."

The Planning Commission has also supported linking domestic coal prices to that of imported coal.

The government has been taking steps to bridge the coal demand-supply gap, which the minister pegged at 60 million tonnes for the current fiscal, by importing the fuel as well as mining it in joint ventures with foreign companies overseas and then shipping the produce to India.

"There are two options—one is importing coal to bridge the gap. The other is acquiring coal properties abroad in joint ventures for meeting our demand," he said.

"We are evaluating which of the two options would be more beneficial for Coal India. We will decide accordingly," he said.

CIL is in talks with US-based Massey Energy, Peabody Energy and Indonesia's Novem/Sinarma for mining coal jointly.

At present, the coal major is conducting due diligence on five properties of these firms in Australia, USA and Indonesia.

"We are also scouting in South African nations," he said.

On the Naxal menace affecting the country's coal production, he said, "Wherever the law-and-order situation is not good, coal mining work is hampered. But the government has no plans to halt mining in those areas."

Many coal-bearing states, including Jharkhand and Orissa, are Naxal-infested.

India produced 531 million tonnes of coal during the last fiscal, out of which CIL's output stood at 431.5 million tonnes.





Murky covers: Unscrupulous schemes to sell insurance products continue unabated

More and more dodgy schemes to sell insurance policies keep crawling out from the woodwork. But a number of insurance companies have preferred to maintain a deafening silence on these devious activities

Selling insurance translates into big money for agents. But a number of agents (and a few who are not authorised representatives of insurance companies) have been coming out with devious plans to sell policies to gullible investors. From operating multi-level marketing (MLM) schemes, blatant mis-selling of Unit-linked Insurance Plans (ULIPs), plastering of fake job applications all over the place and sending misleading text messages—every trick in the book is being tried to peddle insurance products.   
Moneylife has repeatedly highlighted these instances—but insurance companies have preferred to look the other way. Here are just a few of the cases that we have written on.

On 25 March 2010, agents from the Life Insurance Corporation of India (LIC) were trying new ways to trick people into buying insurance. A client was sold a policy under which she had to make a one-time premium payment of Rs1 lakh for 10 years—she was assured a monthly pension of Rs5,000 for the rest of her life. Debt-oriented instruments can offer returns of no more than 6%-7%, while equity-linked products can manage maximum returns of 15%. So what was the basis on which the client was offered these impossible returns on an insurance product? LIC has not replied to any of the detailed emails sent to them, till date.

Here’s another scheme that came to light on 6 April 2010, again involving LIC. Swarg, a corporate agent for the State-run insurer, was running an MLM scheme in LIC’s ‘Jeevan Saral Policy’. According to this ‘scheme’, after buying a Jeevan Saral Policy for a yearly premium of Rs6,005, one could earn an extra income of up to Rs4,46,976 within two years by getting in three more members into buying the policy. These members would have had to rope in three more members, and so the chain would go on.

This time, LIC responded by saying that “MLM is not allowed for selling life insurance. If anyone is doing it, action will be initiated. It is not permissible.” Yet, we have not heard of any action taken by the insurer so far.

On 16th April we wrote on how there is a company called Team Life Care Co running a website in which it lists down all the Bajaj Allianz products that it sells. However, Team Life Care Co was running a mirror website through a company called TLC Insurance Pvt Ltd where it was peddling a bizarre MLM scheme.

Moneylife contacted both Team Life Care Co and TLC Insurance (India) Pvt Ltd and members from both companies confirmed that these entities were part of the same organisation and shared a common managing director, one Mr Jagannath. When we contacted Bajaj Allianz, their response was: “We wish to inform you that Team Life Care Co (India) Ltd is a Corporate Agent of Bajaj Allianz Life Insurance and they solicit business through approved specified persons only.” So how was TLC Insurance running the MLM scheme?

On 19 April 2010, we reported on how Jeevanseva, a direct marketing firm, was selling personal accident schemes from Reliance General Insurance in an MLM format.

Again, there was no response from the insurer.

Another company is so brazen in its approach towards peddling MLM schemes involving LIC products, that it calls itself ‘Rose Valley Chain Marketing System’. It has an elaborate chain marketing scheme, as the name indicates, and has no qualms in handing out brochures that detail its MLM product.

On 18 May 2010, an official from Rose Valley told Moneylife, “Once you reach a certain level, you don’t have to work anymore; you can earn commission bought by your chain.” As usual, there was no response from LIC when we told them about Rose Valley’s MLM scheme.

On 27 May 2010, we reported on how local trains in Mumbai were being plastered with advertisements of an ‘incredible’ deal being offered for selling life insurance products of Birla Sun Life Insurance. As per the ad, anyone who goes in for this scheme would work only for two hours a day, sell five policies a month. For doing all this, the agent would get a commission of Rs6,000 per policy sold, amounting to Rs 3.6 lakh a year.

Birla Sun Life responded by saying that these schemes were not according to the company’s rules and regulations. “Our legal and compliance officer is already in action. We will be taking appropriate action against the person involved.” We have spoken to them over the past few days; we still await the results of their investigation.

On 11 May 2010, we had sent a mail to the Insurance Regulatory and Development Authority (IRDA) regarding these issues. A Giridhar, IRDA’s executive director told Moneylife: “Selling insurance through unlicensed persons is illegal. We will act on the information.”

When such schemes are expressly prohibited by the regulator, why do they continue to proliferate? That’s the question that both IRDA and the insurance companies need to answer.



Ramesh Karel

6 years ago

Good work!! A part of problem also is that though SEBI discloses, IRDA does not disclose the orders it has passes on its website. So if at all any action taken, is never known.

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