Insurance Bill may be cleared by year-end

The much-delayed Insurance Bill seeks to raise the foreign investment cap in the sector from 26 per cent to 49 per cent

Union Finance Minister Arun Jaitley addresses the Pension Conclave organised by Pension Fund Regulatory and Development Authority (PFRDA) in New Delhi on Tuesday. Photo: S. Subramanium

Union Finance Minister Arun Jaitley has expressed hope that Parliament will pass the Insurance Bill for raising the foreign direct investment (FDI) limit to 49 per cent by the end of this year, the first major economic reform proposed by the Narendra Modi Government.

“Hopefully by the end of the year the amendments to the Insurance Act will get approved by Parliament and then notified,” Mr. Jaitley said at a function for the release of the Pension Fund Regulatory and Development Authority (PFRDA) annual report and website launch in New Delhi on Tuesday.

“There is an intrinsic link between insurance and the pension sector. The FDI limits in the Insurance Act automatically applies to the pension sector.”

The UPA Government had originally proposed raising the FDI cap back in 2008 when it introduced the Insurance Laws (Amendment) Bill. However, opposition from political parties, including the BJP, did not allow the Bill to be taken up in the Rajya Sabha.

The Modi Government introduced a fresh Insurance Laws (Amendment) Bill in Parliament earlier this month. It proposes a rider that management control rests in the hands of an Indian promoter alongside the eased FDI cap.

After the introduction of the Bill, the government moved 97 amendments because of which it could not be passed.