The government’s decision to impose 10% customs duty on newsprint deals a further blow to an industry that is already flailing. The duty will apply to uncoated paper used for newspapers and lightweight coated paper used in magazines. The Association of Indian Magazines has registered its protest, calling the duty “unfortunate” and a “double whammy for print media”.
Declining revenues in a bleak macroeconomic environment had already weakened print media. Recent reports also suggested that the government was tapering off advertisements to three major media houses, Bennett, Coleman & Co, which publishes the Times of India and The Economic Times; the ABP Group, which runs the Telegraph; and The Hindu newspaper group.
Taken together, the two decisions raise a serious question: does the survival of a free press feature on the Centre’s list of concerns?
The ostensible reason for imposing a duty on newsprint was to encourage the domestic industry. Announcing the move, Finance Minister Nirmala Sitharaman explained it was not protectionist but in keeping with the Bharatiya Janata Party’s “Make in India” agenda. She also claimed there was plenty of newsprint to go around in India.
This seems disingenuous. According to industry estimates, domestic capacity can meet only 15%-20% of the total demand for newsprint in India. Besides, most outlets have reportedly updated technology to be compatible with international newsprint.
Publishers also fear that switching to domestic newsprint will mean a decline in quality, making consumers more reluctant to pay for publications at a time when subscription revenues are needed badly. Staying with imported newsprint will push up costs for publishers. This, when they were just recovering from last year’s hike in prices. They went up by 40%-60% after China, one of the major exporters of newsprint, decided to stop production.
Several publishers have interpreted the import duty as a fresh attempt to put financial and editorial pressure on the print media, sections of which have often been critical of the government.
This impression is reinforced by the choice of newspapers reportedly frozen out of government ad revenues. While the Telegraph has frequently run articles critical of the Modi government, The Hindu reported on irregularities in the Rafale deal. The Times of India’s infraction, according to Opposition leaders, was to cover alleged violations of the Model Code of Conduct by Prime Minister Narendra Modi as he campaigned for the Lok Sabha elections. So for several media houses that refuse to toe the government line, costs will go up while revenues dry out.
The apparent financial squeeze is the latest in a series of worrying developments. Since 2014, when the Modi dispensation first came to power, journalists have complained of intimidation for writing stories critical of the government.
The government has, in turn, pulled back the drawbridges, refusing to entertain questions from the media. In his five years in power, Modi did not speak at a single press conference.
The traditional relationship between government and media in a democracy – where the media speaks truth to power and the government feels a duty to answer questions asked of it – has been disrupted.
As it cracks down on a free press, the Modi dispensation must know that it is destroying its own credentials as a democratic government.