Insurance Bill: Congress changes tack, toes Centre’s line

AM JIGEESH New Delhi | Updated on March 12, 2018

Hopeful Finance Minister Arun Jaitley in the Rajya Sabha on Monday PTI

Select committee to table report in Parliament tomorrow

The ruling Bharatiya Janata Party (BJP) succeeded in limiting the dissent notes to the Select Committee’s report on the Insurance Bill to four, as the Congress, AIADMK and Bahujan Samaj Party (BSP) decided to toe the Government’s line.

Four parties — the CPI(M), Trinamool Congress, Janata Dal (United) and Samajwadi Party — have submitted dissent notes to the panel’s report recommending an increase in the foreign direct investment (FDI) limit in the insurance sector.

The panel, headed by BJP MP Chandan Mitra, has asked the Centre to define the term ‘control’ in the Bill.

It suggested that an explanation be added in the Bill that “the term ‘control’ shall include the right to appoint a majority of the directors or to control the management or policy decisions, including by virtue of their shareholding or management rights or shareholder agreements or voting rights”.

“We felt that there should be clarity on the issue of control. The control of the companies should remain with Indians,” a panel member said.

The Select Committee, which makes recommendations to the House, will table its report on Wednesday. The Bill is likely to be taken up next week.

With the Congress offering its support, it will be easy for the Government to pass the Bill.

Later, Finance Minister Arun Jaitley told a trade delegation from the UK that he is hopeful that expansion of the insurance market will take place once the Bill is passed. He expressed his “sense of satisfaction” over the recommendations made by the Select Committee.

The committee rejected the demand of Opposition parties to not increase the FDI limit from the existing 26 per cent.

“In view of the increasingly globalised economy and expanding global financial flows, involving manufacturing, banking etc for growth and development, the Committee is not in agreement with the argument of not increasing the cap in the insurance sector…” the report said. It, however, urged the Centre to limit FDI and all portfolio investments to 49 per cent.

The Opposition parties accused the Congress of taking a U-turn from its stated position against the foreign institutional investor route.

Published on December 08, 2014

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