New Delhi: The National Democratic Alliance (NDA) government's first major reform initiative the Insurance Laws (Amendment) Bill will not be taken up for discussion in the Rajya Sabha on Monday.
Parliamentary Affairs Minister M Venkaiah Naidu said that he and Finance Minister Arun Jaitley will on Monday talk to Congress leaders and opposition parties on various aspects of the bill.
"I and Finance Minister Arun Jaitley desire to discuss this bill tomorrow (Monday) with leaders of Congress and other opposition parties so as to understand their concerns and address the same,” Naidu said on Sunday night.
The Upper House members had sought time to study the proposed changes in the bill by the Union Cabinet last month. The changes include increase in the foreign investment limit for the insurance sector to 49 per cent from the current 26 per cent.
"I appeal to all opposition parties in the Parliament, particularly the Congress, to cooperate in passing the Insurance Laws (Amendment) Bill, 2008 that seeks to enable much desired capital inflows into the insurance sector," Naidu said.
"Penetration of insurance coverage in the country is being adversely impacted on account of inadequate investments," Naidu added.
Insurance companies have a low level of penetration in the country for want of capital, with life insurance at below 4 per cent of GDP and general insurance at less than 1 per cent.
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 per cent 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 (UPA) 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.
"We have decided to support the insurance bill along with the changes proposed by the government," BJD leader in the Lok Sabha Bhartruhari Mahtab said here.
In the 243-member Rajya Sabha, the NDA has 59 members and the Biju Janata Dal (BJD) which is supporting the reforms has seven members.
