Zee Media Bureau
New Delhi: The Insurance Laws (Amendment) Bill, the NDA government's first major economic reforms legislation, will not be taken up for discussion in the Rajya Sabha on Monday.
The government had to defer its plan on Sunday night with Parliamentary Affairs Minister M Venkaiah Naidu saying he and Finance Minister Arun Jaitley will on Monday talk to leaders of Congress and opposition parties on various aspects of the bill that seeks to raise the FDI cap in the insurance sector from 26 percent to 49 percent.
The bill could not be taken up on Thursday also as the upper house members had sought time to study the proposed changes in the bill, approved by the Cabinet in July.
Earlier on Sunday, Naidu had urged opposition parties to cooperate in the successful passage of the Insurance Laws (Amendment) Bill, 2008 “that seeks to enable much desired capital inflows into the insurance sector”.
"Penetration of insurance coverage in the country is being adversely impacted on account of inadequate investments," he had added.
Insurance companies have a low level of penetration in the country for want of capital, with life insurance at below 4 percent of GDP and general insurance at less than 1 percent.
The amendment is expected to bring in much needed additional equity to the tune of Rs 25,000 crore to the insurance sector.
While up to 26 percent foreign investment will be allowed automatically, beyond that will require approval through the Foreign Investment Promotion Board (FIPB). Control of the insurance venture will have to remain in Indian hands.
The Congress is backing the Trinamool Congress and Left parties' proposal to send the bill to the parliamentary Select Committee, which would scuttle any government move to get the legislation passed by convening a joint session of two houses.
The party justified its decision saying that the amendments moved by the NDA government mark "substantive changes" from the original bill that was introduced by the first United Progressive Alliance government in 2008.
Meanwhile, bolstering the government's efforts to get the insurance amendment bill passed, the Biju Janata Dal (BJD) has decided to support the reforms.
In the 243-member Rajya Sabha, the National Democratic Alliance (NDA) has 59 members and the BJD has seven members.
(With IANS inputs)
