The government has relaxed FDI norms for the insurance sector by permitting overseas companies to buy 49 percent stake in domestic insurers without prior approval, which is another effort to bring more foreign players into India’s vast insurance market.
Earlier, an overseas company was allowed to buy up to 26% stake in an India-based insurance company. But, for up to 49 percent the investor had to take prior approval from the Foreign Investment Promotion Board (FIPB). However in its latest notification the government said, the foreign investment proposals up to 49% of the total paid up equity of the Indian insurance company shall be allowed on the automatic route subject to verification by the Insurance Regulatory and Development Authority of India.
There are 52 insurance companies operating in India, of which 24 are in the life insurance business and 28 in the general insurance. In order to deepen the re-insurance market, IRDAI permitted UK-based Lloyds to set up business in India.
Insurance Regulatory and Development Authority of India (IRDAI) is an autonomous apex statutory body which regulates and develops the insurance industry in India. It was constituted by a Parliament of India act called Insurance Regulatory and Development Authority Act, 1999 and duly passed by the Government of India.
IRDA Chairman is T.S. Vijayan.
Foreign direct investment (FDI) in the country more than doubled to about $4.5 billion in December.
India receives maximum FDI from Singapore, Mauritius, the Netherlands and Japan.
In 2014-15, foreign fund inflows grew 27 per cent to $30.93 billion as against $24.29 billion in 2013-14.
So lets do:
- Who is the Chairman of IRDA?
- Government of India allow how much FDI insurance under automatic route?
Source – The Hindu