Leading Japanese insurance company Sumitomo Life has set its eyes on entering the Indian market. The company?s senior officials are slated to visit India later this year to finalise a local partner for offering their gambit of services. According to industry sources, Sumitomo Life has been closely studying the Indian market over the last few years to expand its operations into the South East Asian region.
?Sumitomo Life will be entering the Indian market. An official announcement is unlikely soon but the company is closely following the developments here,? a person with direct knowledge of the company?s India entry told FE. He said that the Japanese firm is on the look out for an Indian partner and would want to make its services available in India at the earliest.
Sumitomo Corporation is among the largest business houses of Japan with business interests from infrastructure and construction to finance and insurance. Sumitomo Life is the fourth biggest insurance provider in Japan and has operations spanning across 60 countries including the US. As on March 31, 2011 Sumitomo Life Insurance had total net assets of $8.5 billion. Despite repeated attempts, officials of Sumitomo Corporation in their offices in New Delhi and Mumbai could not be reached for comments.
As per extant laws one of the pre-conditions for a foreign insurer to set shop in India is that it has to enter into a joint-venture with an Indian partner which is subject to an FDI cap of 26%.
According to reports the government is mulling to allow foreign re-insurance companies to open branch offices in India with a minimum net worth of R5,000 crore. The Japanese firm?s entry could be significant since in the recent past FDI inflows into India have been declining owing to negative macroeconomic factors.
