(PTI 12/06/2006) Brussels - The Government said on Monday that it planned to bring a Bill to amend the Insurance Act, which among other things, provides for increasing FDI cap in the sector from 26 per cent to 49 per cent.
The government plans to present the Bill to change the rules, Finance Minister P Chidambaram said in an interview without specifying the time-frame.
The insurance sector was opened to private players in 2000, ending the state monopoly of LIC and GIC, after much dilly-dallying in the 1990s that also saw the then United Front government dropping a bill for opening up just health insurance.
This led to setting up of several joint ventures between domestic and foreign companies in both life and general insurance sectors, including ICICI Prudential, Bajaj Allianz, and HDFC Standard.
However, the FDI has been capped at 26 per cent. Chidmabaram had announced raising the FDI cap in insurance sector in his first Budget as the Finance Minister in the UPA government in 2004. However, the Bill to amend the Insurance Regulatory and Development Authority Bill could not be tabled in Parliament.
The crucial Left supporters of the ruling coalition oppose any increase in FDI cap in the insurance sector.
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