Rajya Sabha passes Insurance Bill

The Rajya Sabha passed the Insurance (Amendment) Bill here on Thursday. The Bill is to raise the limit of foreign investments in an Indian insurance company from the existing 49 per cent to 74 per cent. Union Finance Minister Nirmala Sitharaman said the Bill is to allow foreign ownership and control of insurance companies with safeguards.

The Opposition demanded that the Bill must be sent to the Finance Standing Committee of Parliament or to a joint select committee comprising members of both houses. The Centre rejected the proposal for a select committee and insisted that the Bill must be passed to further the reform process in the sector. The Opposition later walked out, protesting the Centre’s decision to not send the Bill to Parliamentary panel.

Sitharaman said the logic of raising more capital for insurance companies, as stated by P Chidambaram when he was Finance Minister, holds ground at present, too. Detailing the safeguard measures, she said Indian money will not go out by inviting more foreign investment. “The policy is in very much in alignment with the existing policy in other sectors that the FDI is to supplement domestic capital,” she said.

Sitharaman said laws of the land are mature, and they can control every operations in the country. She said majority of the directors will be Indians so that they will be under the watch of the law of the land. “Specified percentage of profits will be retained as general reserve. This should address the concerns of the Opposition members,” she said. She said private companies in the insurance sector can use the FDI option when they need money.

She said reservation applies to all public sector companies. She said there will be presence of public sector companies and reservation will be protected.

Earlier, Opposition leader in Rajya Sabha, Mallikarjun Kharge, urged the Centre to send it for the scrutiny of a Parliamentary panel. He asked the Centre to learn from the lesson of three farm laws.

Expansion of insurance sector

The BJP’s main speaker and former Finance Minister of Bihar, Sushil Kumar Modi, said the Bill will be firm reform step and that it will help in the expansion of the insurance sector in the country. He said India needs more insurance companies and this Bill will bring in more investment.

Congress leader Anand Sharma reminded the Centre that the BJP had opposed the increase in FDI limit in the sector when the UPA was in power. He said the sale of strategic companies would do no good for the country.

CPI MP Benoy Vishwam lamented that the Centre has decided to bring the Bill on a day when LIC employees, cutting across political differences, are on strike to protect their company. He said the Centre is on a selling spree and almost all major PSUs, even in strategic sectors, are being sold to corporates.

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