NR
Govt introduces insurance sector
reforms bills in Parl- foreign investment cap to 49 per cent
Mumbai, Dec. 22, 2006
Inderkant Patel
Unfazed by stiff resistance from the Left, Government on Monday
introduced two insurance reforms bills in Parliament aimed at hiking
foreign investment cap to 49 per cent and raising the capital base
of state-owned Life Insurance Corporation.
The UPA government, which had kept insurance reforms in cold storage
for almost four years in view of strong opposition from its erstwhile
Left supporters, introduced the Insurance Laws (Amendment) Bill,
2008 in the Rajya Sabha after a high drama.
Through this bill, the foreign direct investment in the private
sector can be raised to 49 per cent from 26 per cent.
The Life Insurance Corporation (Amendment) Bill was introduced
in the Lok Sabha after an unsuccessful attempt by the Left parties
to stall it by division of votes.
The Bill seeks to raise the capital of LIC from Rs five crore to
Rs 100 crore.
In the Rajya Sabha, as Minister of State for Finance P K Bansal
rose to introduce the bill, CPI(M) member T K Rangarajan dashed
towards him to snatch the papers from him.
An agitated External Affairs Minister Pranab Mukherjee pushed the
CPI(M) member to protect his colleague while another minister Meira
Kumar provided a shield to Bansal.
Although UPA had unveiled plan to raise the FDI cap in the insurance
sector in July 2004, it could not move on the issue because of opposition
from Left which supported its government till July this year.
The government had referred the insurance sector reforms to the
Group of Ministers which gave a go-ahead only after UPA parted ways
with the Left combine.
Once its capital base is increased, LIC would be complying with
the norms of the regulator IRDA
|