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Pvt bank-mooted insurance firms will need RBI sign-off
The government has said applications for foreign direct investment in an insurance company promoted by a private bank will be cleared by the RBI and Irdai to ensure that the 74 percent limit of overseas investment is not breached.
By
migrator
migrator
New Delhi
These changes were made by amending the Foreign Exchange Management (Non-debt Instruments) Rules, 2019, according to the gazette notification issued by the Finance Ministry on August 19, 2021.
“These rules may be called the Foreign Exchange Management (Non-debt Instruments) (Second Amendment) Rules, 2021,” it said. Earlier in March, Parliament passed a bill to raise the foreign direct investment (FDI) limit in the insurance sector from 49 pc to 74 pc. The Insurance Act, 1938 was last amended in 2015, which raised the FDI limit to 49 percent, resulting in a foreign capital inflow of Rs 26,000 crore in the last five years.
There are 24 life insurance companies and 34 general insurance firms operating in the country.
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