TMC reaffirms opposition to hike in FDI cap in insurance

Trinamool Congress (TMC) leader Derek O'Brien reiterated here today that his party will strongly oppose the move to hike the FDI cap in insurance sector from 26 to 49 percent.

O'Brien told ANI, "On FDI in insurance, the TMC has been the most consistent party. We did not even want 26 percent, and now 26 to 49, there is no chance. This new bill which the government is trying to push through, we are strongly opposed to it."

The Bharatiya Janata Party will again introduce a bill in the Rajya Sabha, to increase Foreign Direct Investment in insurance from 26 to 49 percent. The bill is expected to be introduced on Monday.

He also said, "TMC is strongly opposed to it because it's not only about 26 going up to 49, there are other provisions in the bill which we have sent out amendments for. Our belief is that the government does not have the numbers in the Rajya Sabha, are the shadowboxing? We'll know on Monday morning."

The TMC spokesperson also said that his party was very happy to take the lead in opposing this FDI in insurance.

The Insurance Bill, which has been pending with the Rajya Sabha since 2008, is expected to attract the much needed long term capital for the sector which can have multiplier effect on the state of economy especially in meeting the huge infrastructure financing requirements, according to the Confederation of Indian Industry (CII).

CII had on Thursday welcomed the Union Cabinet's approval to the proposal to raise the foreign direct investment (FDI) cap in the insurance sector to 49 percent from the existing 26 percent.

Chandrajit Banerjee, CII Director General, had emphasized that capital infusion in the insurance sector, through greater FDI, would ensure innovations on product design and distribution, better risk management, introducing superior technology and greater investments.

"CII believes the end result will be sizeable improvement in the insurance penetration and density for the Indian economy which is considerably lower when compared with other emerging economies," said Banerjee.