It is known that there have been some movements towards changing the regulations of Foreign Direct Investment in the Indian insurance industry, which allows foreigners to hold shares in an Indian insurance company of up to 49%. Japan would like to know whether there are any specific issues/problems to be solved for further progress and how soon this regulation of FDI will be amended.
Reply: Government had introduced the Insurance Laws (Amendment) Bill, 2008 in the Parliament on 2.12.2008. The Bill, inter alia, provides that the aggregate holdings of equity shares by a foreign company, either by itself or through its subsidiary companies or its nominees in Indian Insurance Companies may be increased from 26% to 49% except in case of insurance co operative societies where the limit would continue to be 26% as at present. At present the Bill is under consideration of the parliament Standing Committee on Finance and it will not be possible to specify a time frame.
