Several news items today say that FDI in insurance sector had been hiked to 49% (from 26%). Is it true? Can Pvt. Insurance Cos. have 49% FDI now?
What happened actually?
Arvind Mayaram Committee was set
up in March 2013 to recommend on the country’s foreign direct investment (FDI) policy.
The
Arvind Mayaram committee suggested that FDI be capped at 49 per cent in
nine sectors. These are FM radio, uplinking news & current affairs,
print media (news & current
affairs), commodity exchanges, stock exchanges, petroleum & natural
gas
refining, insurance, defence production and private security agencies.
The committee also suggested that clearance for the foreign investment proposals (except for defence production and private security agencies) be through the automatic route, without referring the proposals to Foreign Investment Promotion Board. However, the clearances from the concerned regulators and ministries will be necessary.
The committee also suggested that clearance for the foreign investment proposals (except for defence production and private security agencies) be through the automatic route, without referring the proposals to Foreign Investment Promotion Board. However, the clearances from the concerned regulators and ministries will be necessary.
The cabinet approved these
recommendations in a meeting today.
As can be seen from the
recommendations, the committee has also proposed increasing the FDI cap for the
insurance sector - from the current 26 per cent to 49 per cent.
But that will
require amendment to the IRDA Act which is pending before the Parliament.
So, no Insurance Co. can now have more than 26% FDI.
How many legs does this elephant have?
How much FDI allowed in Insurance?
But, when the parliament meets in the monsoon session from 5th August 2013, the government may try to push for the approval of the Insurance Laws (amendment) Bill.
We have to fight against it!
Be prepared!!
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