The Union Cabinet has reportedly cleared the Insurance Amendment Bill and it will be introduced in Parliament on Monday (December 15), according to CNBCTV18. The proposed legislation seeks to raise the foreign direct investment (FDI) cap in insurance companies to 100%. The move is seen as a step to boost capital inflows into the sector.
A formal Cabinet briefing on the approval is scheduled for 4 pm, where more details are expected to be shared, CNBCTV18 reported.
In her Budget speech earlier this year, Finance Minister Nirmala Sitharaman made the announcement of a major reform plan, proposing to raise the foreign investment cap in the insurance sector from 74% to 100%. The finance minister stated that this was part of a wider reforms in the financial sector.
According to Narendra Ganpule, Partner at Grant Thornton Bharat, the move underscores the government’s commitment to “economic liberalization and creating a robust, investor-friendly ecosystem”. “The transition to 100% foreign ownership will eliminate previous complexities associated with finding domestic partners and is expected to attract new global players while allowing existing foreign participants to increase their stakes and autonomy,” Ganpule added.
(More details to follow)