India to raise insurance FDI cap to 49%
April 8, 2013, 12:53 pm

The finance minister said he is in touch with the leaders of the Opposition on the Bill [AP]

The government is trying to forge a consensus with opposition parties to ensure the passage of the Bill.

Palaniappan Chidambaram said the optimism stems from the fact that there is difference of opinion only with regard to one clause in the long-pending Bill, for which he is in touch with the main opposition party.

“I sincerely hope that we can pass the Insurance Amendment Bill on which the difference only on one clause and once the Insurance Bill passes everybody’s broadly agrees that the Pension Bill will follow,” he said.

The Insurance Bill seeks to raise the foreign investment cap in the sector from 26 per cent to 49 per cent.

The Pension Bill also aims to increase it to the same level.

Mr Chidambaram said the Pension Bill is only a reflection of what is contained in the Insurance Amendment Bill.

The minister said he is in touch with the leaders of the Opposition on the Bill.

The Budget Session of the Indian Parliament will resume on April 22, after about a month-long recess.

During his trip to Tokyo last week, Mr Chidambaram said India’s economy is capable of absorbing $50 billion in foreign direct investment per year.

The Indian insurance sector may see the entry of a new foreign player, as Canada’s largest insurer Manulife Financial is actively studying the market to find a workable business model to set up shop here.

A host of global insurance giants, including Allianz, Prudential, Standard Life, Aviva, Aegon and Nippon Life, are already present in the Indian insurance market through joint ventures with their respective Indian partners.

Source: Agencies