Leading international communications agency Hill & Knowlton Asia Pacific has received clearance to set up a 100 per cent subsidiary in India that will offer public relations and public affairs communications services in the country.

This is the first time Hill & Knowlton, part of the WPP group that has several joint ventures in advertising, is venturing into India in this area. The Hong Kong-based company has presence in more than 41 countries across the globe.

The WPP Group, however, has a bevy of JVs in the country, including ad major Hindustan Thomson Associates, Bates India, Equus Advertising, Ogilvy & Mather, Group M Media, Rediffusion Dentsu Young & Rubicam, Sudler & Hennessey and Brand David Communications among others.

The Foreign Investment Promotion Board cleared the proposal with certain conditions.

One, all future laws on broadcasting will be applicable to the company and they will not claim any privilege or protection by virtue of the approval given to them. Second, the company will not undertake any broadcasting from the Indian soil unless it is permitted to do so.

Third, if any satellite activity is undertaken by the company in the future, they will have to comply with the broadcasting programme and advertising codes.

The PR business has been attracting the attention of international agencies and many have already set up JVs or signed partnerships with Indian players.

Manning Salvage Lee, for instance, has a JV with Hanmer & Partner, Burson Marsteller with Genesis PR, Edelman-with Roger Pereira, while Weber Shandwick has a stake in Corporate Voice.

Industry experts say that Fleishman Hillard is expected to come to India on its own, while Ketchum has tied the knot with Sampark Public Relations as a preferred partner.

PR industry sources say that the Rs 300-350-crore (Rs 3 to Rs 3.5-billion) industry has been growing at a comfortable clip of over 20-25 per cent annually, but has now been hit by the slowdown in the economy.