49% FDI in insurance will ensure overall devpt: Exide Life

India Infoline News Service | Mumbai |

The insurance industry requires as much if not more in terms of fresh capital to be able to fund its growth and its expansion, Exide Life says

The government today said that the Cabinet has approved 49% FDI (foreign direct investment) in insurance industry. The Cabinet approved amendments to the Insurance Bill. Following the news insurance companies stocks surged on BSE.
Kshitij Jain, MD & CEO, Exide Life Insurance, said, “It is a very good news that the Cabinet has approved to ease the FDI cap to 49% cap on Insurance. The industry over the last 12 years has attracted over Rs 34,000 crore of capital across all the private life insurance companies and over the next five to 10 years. The industry requires as much if not more in terms of fresh capital to be able to fund its growth and its expansion.”
The easing of the FDI cap to 49% in the insurance sector will ensure overall development not just of the sector but the country at large. With an increase in the limit, the insurance industry expects to get not only the capital but also technical and product expertise of foreign partners. FDI in insurance would also increase the penetration of insurance in India, where the penetration of insurance is abysmally low with insurance premium at about 3% of GDP against about 8% global average. The industry at this stage does need long-term capital for continued growth and expansion which only FDI can bring in.
 

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