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New Delhi, Apr 4 Pitching for raising the FDI cap in insurance segment to 49 per cent, financial solution provider firm SMC Global Securities on Monday said the move would help the sector become a $65 billion industry by 2014. SMC Global Securities said the current size of the domestic insurance industry is estimated at $45 billion.
The firm has urged the UPA government to “initiate serious deliberations” with all it’s constituents to increase FDIs limit in insurance sector to 49 per cent from the current level of 26 per cent. Raising the limit would help the insurance industry grow at a much faster pace as also facilitates larger foreign direct investment, the company’s Chairman and Managing Director Mr Subhash Chand Aggarwal said.
“With 26 per cent foreign equity element of FDI’s in insurance business, not many foreign players are keen to make a foray in it ever since this industry was opened up for a limited competition way back in 1999,” he added.
“If UPA government is able to garner support from its constituents to hike FDIs limit in insurance sector (at the earliest)...the size of insurance industry would jump up to over $65 billion by 2014,” said Mr Aggarwal.
A bill to raise the FDI limit in insurance sector from 26 per cent to 49 per cent is awaiting Parliament approval.
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