Shares of five insurance companies rose by 0.32% to 3.65% at 12:15 IST on BSE after Finance Minister Arun Jaitley said he is expecting that Insurance Amendment Bill will be passed in the forthcoming winter session of parliament.
Finance Minister Arun Jaitley made the statement after market hours yesterday, 17 November 2014.
Meanwhile, the S&P BSE Sensex was up 16.59 points or 0.06% at 28,194.47.
Among shares of insurance companies, ICICI Bank (up 0.32%), State Bank of India (up 0.52%), Aditya Birla Nuvo (up 0.7%), Max India (up 0.65%), and Reliance Capital (up 3.65%), gained. HDFC (down 1.76%) and Bajaj Finserv (down 0.46%) declined.
Finance Minister Arun Jaitley said that he is in touch with the Parliament Select Committee in this regard and will try to persuade it to give its report at the earliest.
The month-long winter session of Parliament will start on 24 November 2014 and conclude on 23 December 2014. The government's priorities are the passage of the Insurance Laws (Amendment) Bill, which seeks to raise the cap on foreign direct investment (FDI) in insurance to 49%, and the Land Acquisition and Rehabilitation and Resettlement Bill. Another priority is the revised Goods and Services Tax (GST) Constitution Amendment Bill, which has been delayed due to lack of consensus among the states.
Taking a reformative step, new finance minister Arun Jaitley had in the Union Budget 2014-15 announced in June proposed increasing the FDI cap in the insurance sector to 49% from 26%. In July 2014, the Cabinet Committee on Economic Affairs (CCEA) approved 49% FDI in insurance.
The proposal to hike FDI in insurance is pending since 2008. The Insurance Laws (Amendment) Bill was introduced by the previous UPA government. However it could not be taken up in the Rajya Sabha as it faced severe opposition from several quarters.
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