Insurance FDI News

With the passage of three key economic legislations in Parliament, Finance Minster Arun Jaitley on Friday exuded confidence that the insurance sector is expected to get a lot of foreign investment.

Jaitley needs the support of the opposition in the 250-member upper house of parliament where his Bharatiya Janata Party (BJP) and its allies have about 60 members.

Shares of companies that run insurance business rose by as much as 4 percent after the Cabinet today gave go-ahead to FDI cap hike in the sector to 49 percent with a rider that management control will remain in the hands of Indian promoters.

The central government`s proposal to approve foreign direct investment (FDI) in the insurance sector through the Foreign Investment Promotion Board (FIPB) is seen as clipping the sectoral regulator`s wings and also a face saving measure by the BJP, say insurance officials.

Welcoming the government's proposal to hike FDI ceiling in insurance sector to 49 percent, Fortis Healthcare Executive Chairman Malvinder Mohan Singh on Friday said the move would help insurance firms attract much-needed capital from overseas partners.

Raising FDI cap in the insurance sector will spur growth in this industry, ensuring entry of more players, Insurance Regulatory and Development Authority said on Friday.