Government s move to relax FDI limit for insurance a big boost for small insurers
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Synopsis
After years of deliberation, the Indian government has increased the Foreign Direct Investment (FDI) limit in insurance companies to 74% against the current 49%, Finance Minister Nirmala Sitharaman announced on Monday in the Union Budget of 21-22 albeit some “safeguards”.
Agencies
Experts anticipate more of the country s 23 private life insurers and 28 private general and health insurers to contribute to the growth of the sector with more impact.
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MUMBAI: Five years after India increased the ceiling on overseas ownership in its insurers, Finance Minister Nirmala Sitharaman Monday heralded bold reforms in a sector considered crucial for underpinning infrastructure financing. She raised the headroom on foreign holding to 74% in one go, potentially multiplying fund-raising avenues in a long-gestation industry that needs as much capital as is available.