15% agency commission on govt ads waived

10% increase in DAVP rates

The government is announcing sops for the media sector in phases, ahead of general elections. While the information and broadcasting (I&B) ministry had earlier this month announced abolition of customs duty on newsprint, it has now waived the agency commission on DAVP (Directorate General of Audio Visual Publicity) advertisements, and also increased ad rates.

I&B minister Anand Sharma on Friday called a press conference to list out the achievements of the UPA government, and topped it up with the news of concession for the print media. This is in response to a charter of demands from the media industry. The industry representatives had met Sharma recently seeking a bailout.

The I&B ministry had taken up the matter with the ministry of finance, which has now given its concurrence for a fiscal stimulus package for the print media, Sharma said on Friday.

The package includes waiver of 15% agency commission on DAVP advertisements, and 10% increase in the current DAVP rates. Both are valid till June 30.

However, the newspapers must provide proof of loss of revenue in non-governmental advertisements, when compared with the corresponding period last year.

According to Sharma, the industry captains have been advised not to cut jobs even as the media sector is experiencing economic slowdown and loss of advertising revenues.

For quite some time now, the print media industry has been feeling the heat of newsprint prices. But, DAVP, which provides the government ads to newspapers, has been hiking the ad rates. Last October, the rates were raised by 24%. And, now they have been increased again.

Recently, the government had announced customs duty exemptions for the newspaper and magazine publishing industry.

Since the increase in ad rate hike is only till June 30, newspapers and magazines would benefit only till the electoral code of conduct comes into play. Once elections are announced and the code comes into effect, the display ads listing out the achievements of the UPA government would also stop coming.

Nivedita Mookerji/ DNA-Daily News & Analysis Source: 3D Syndication