Media: Murdoch stumbles in the passage to India

Rupert Murdoch has done everything in his power to smooth the way for digital satellite television on the subcontinent, but the Indian government has banned it. Peter Popham reports from Delhi

During the 1990s, satellite has transformed Indian television from afar. Star TV, the originally Chinese satellite network which beams seven channels of news, sport, Hindi and western films and other programming to the subcontinent, is based in Hong Kong; and while Star collects fees from the cable operators who receive Star's signals on their dishes and retransmit them to Indian homes, private broadcasting is still not legal here.

Rupert Murdoch bought Star after it had achieved its stunning success here. Now his next challenge is to win over the Indian authorities, but in the past six weeks he has run into serious trouble.

Building on the success of Star, Murdoch plans to bring digital satellite television, what is known here as Direct to Home or DTH, to the subcontinent. For this purpose he has set up India SkyB (ISkyB) in Delhi. But although he has done everything in his power to smooth his way, including cosy chats with the prime minister and stealing executives from the top echelons of the civil service, on 16 July the government issued a blanket ban on DTH.

Murdoch's chief executive, formerly with the Ministry of Information, has been told to resign by the government for failing to clear his appointment to Star with his superiors; if he declines he has been threatened with prosecution. He is also under investigation by the Central Bureau of Investigation, and other staff lured from public service have been notified that they may have broken their contracts by joining him without getting permission. As Murdoch pours millions of rupees a month into keeping his new service in mothballs, the ride ahead looks bumpy.

Less than ten years ago, television in India meant a single turgid channel, wholly owned and controlled by the government. Today about 15 million Indian homes have access to some three dozen channels (out of a total of 40 million television-owning homes), and the government service (Doordarshan) has two channels, both of which rival the private ones for liveliness. Huge quantities of Hindi musical film schlock and American B movies wash over the viewing population. But the Doordarshan news programmes have transformed their act in response to Star Plus's more professional and stimulating bulletins, and television has shaken off its long-term image problem of being print journalism's ill-favoured sister.

Star, which Murdoch only piggybacked after it had done its work, thus deserves much of the credit for revolutionising Indian television. In the first 40 years of independence, India's print and broadcast media made a striking contrast. India inherited from the Raj a vigorous, liberal and largely independent press serving the English-speaking elite, and a monolithic broadcasting service which was an arm of the government. That was the way it long remained: India's newspapers (which Murdoch cannot buy because foreign ownership is banned in the Constitution) are by far the best in Asia, and play an important part in the political debate.

Television and radio, by contrast, meant public service interpreted in a stifling and paternalistic way, bringing worthy programmes about farming and culture, and soap operas campaigning against social divisiveness, to the masses in the countryside.

The overlap of consumption between the media was small. Successive governments declared their desire to make broadcasting more independent of government instead of being merely a department inside the Ministry of Information and Broadcasting. But broadcasting was the Congress Party's pet, and come election time it always proved far too convenient to keep things that way.

Two events shattered the status quo. In the late Eighties Congress lost its hegemonic grip on government; and in the early Nineties satellite television arrived. The events were unconnected, but their consequences combined to change the nature of Indian television for ever.

The opposition politicians who attained power in the late Eighties were keen to set broadcasting free, to give it a political neutrality akin to the BBC's. In 1989 they even passed the legislation to do so. That law languished unimplemented in the statute book for years (it is finally due to be put into effect on 15 September), but the stifling, Congress- dominated climate had changed. So when Murdoch began dazzling Indian viewers with his goodies, Doordarshan was surprisingly quick to respond.

The next move, in India as in Britain, was to introduce digital satellite television, with its vast number of potential channels, and the decoding set-top box. But in order to do this, Murdoch had to go fully legitimate in India. He probably congratulated himself on having prepared the ground well. He set up ISkyB to operate the new service with a staff of 150 and monthly overheads of about pounds 500,000. He readied an operational satellite, and spent nearly $21 million a year renting seven KU-based transponders. He recruited Ratikant Basu, senior civil servant in the Information Ministry and simultaneously director-general of Doordarshan when that company joined the modern world. (Basu's salary went up from pounds 200 to more than pounds 26,000 per month. This helps to explain why he was happy to renounce his government pension, and why other recruits have not been hard to find.)

But last month the government pulled the plug. What enabled Star to get established in India was the legislative vacuum - here as elsewhere satellite television arrived out of the blue. Now the government is halfway through enacting the Broadcasting Bill which will set up a Broadcasting Authority to regulate all private broadcasters. Its ban on DTH is intended to be temporary, pending the setting up of the authority; having observed other governments' weaknesses in dealing with Murdoch, it is understandably wary of allowing him to steal a march on them.

Murdoch of course is screaming blue murder. Two days after the DTH ban, Basu sent a letter to the Information Minister, Jaipal Reddy, pleading to be allowed to set up the service ahead of legislation and offering Doordarshan up to 10 channels on its DTH platform. Three days later, receiving no response, Murdoch's company in India challenged the government in the Delhi High Court. That case continues. Then on 22 August Murdoch's chief executive at Star in Hong Kong flew into Delhi and called on the prime minister, Inder Kumar Gujral.

The government's response to all this suggests it is willing to play hard ball. One reason may be that recently Basu hired two senior intelligence officers, and this is said to have alarmed the authorities thoroughly. The Central Bureau of Investigation has dredged through Mr Basu's record as head of Doordarshan and is said to be preparing to sue him under the Prevention of Corruption Act for getting too cosy with Star while still with the state company.

Few Indians would deny the invigorating effect that Star's satellite programming has had on television in India. Like too many things here, it had become intolerably stagnant; now, for the first time ever, it is beginning to rival print as a medium for intelligent debate, while its entertainment programming dazzles millions. But for Murdoch to build on these successes will be a tough challenge in a country with a gut aversion to arrogant outsiders, and a lingering attachment to the Gandhian ideal of self-sufficiency. His customary urge to dictate terms goes down as well here as a solar topee and a swagger stickn