The uncertainties in global markets, especially in the euro zone, may cause volatility in the Indian market, but there is no cause for worry, Finance Minister Pranab Mukherjee said on the sidelines of a meeting here on Tuesday. Policymakers here have already taken appropriate measures and there is no need to press the panic button, he said.
On the stand-off between the market regulator Securities and Exchange Board of India (SEBI) and the insurance regulator Insurance Regulatory and Development Authority (IRDA) over the unit-linked insurance policies (ULIPs), he said. “I am aware of the recent issues arising in the life insurance industry, especially concerning ULIPs. We will resolve this issue soon.”
On fuel price hike, Mr. Mukherjee said a decision would be taken at the next empowered Group of Ministers (EGoM) meeting. “We have received the recommendations of the Kirit Parekh Committee,” he said without elaborating further.
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Earlier, inaugurating the building of the Insurance Institute of India, Mr. Mukherjee said, “with a fund size exceeding Rs. 11-lakh crore, the insurance industry has contributed to the borrowing programme of both Central and State governments as also to that of the public and private sectors. One of the important challenges before the industry today is to generate the required level of awareness about the benefits of insurance to the people, particularly those living in semi-urban and rural areas. It should be our endeavour to take all necessary steps to ensure the reach of insurance to the masses.” Mr. Mukherjee said that crop insurance was still not popular among farmers. “At present, only 20 per cent farmers are covered under agriculture insurance schemes. Recognising the importance of crop insurance as a critical risk management tool, we have taken a serious view of the huge gap between the amount of crop loan disbursed and that covered under the scheme.”
Touching upon the importance of technology in the insurance industry, he said “it is an accepted fact that insurance business is technology-driven. It has the potential to save cost and hence the scope for reducing price of product.”