The Opposition Congress joined hands with the ruling BJP in the Rajya Sabha to pass the Insurance Laws (Amendment) Bill, 2015, a legislation that has been pending for close to a decade. The Bill envisages 49 per cent FDI in the insurance sector.

Reacting to the news, State Bank of India Chairperson Arundhati Bhattacharya said: “The FDI limit hike in insurance could result in an immediate inflow of around ₹20,000 crore.”

The new law also allows PSU general insurers to tap the capital market.

Soon after the Bill was passed, Sunil Bharti Mittal said that his company Bharti and its French partner AXA remain fully committed to their insurance joint venture and confirmed that AXA would step up its equity investment to 49 per cent. Bharti said it would shortly move the application to the Foreign Investment Promotion Board. Bharti now owns 74 per cent in the venture and AXA 26 per cent.

Minister of State for Finance Jayant Sinha said the Bill would help expand the insurance ambit.

Left parties, however, alleged that the Bill would hamper the financial sector by making it vulnerable to foreign markets.

To ensure passage of the Bill, the Centre withdrew a pending legislation on the same subject. The amendments moved by the Left parties were voted negative by NDA and UPA members. Members of Trinamool Congress, SP, BSP, JD (U) and DMK walked out during the vote.