During Budget 2021, Finance Minister Nirmala Sitharaman proposed allowing 74 percent FDI in insurance companies.
According to the draft rules, the cap on foreign direct investment (FDI) has been raised to 74 percent from 49 percent.
The Centre has issued draft rules for insurance companies that have significant foreign investment.
Department of Financial Services (DFS), a part of the Ministry of Finance, said amendments had been made to the Indian Insurance Companies (Foreign Investment) Rules, 2015.
According to the draft rules, the cap on foreign direct investment (FDI) has been raised to 74 percent from 49 percent.
Here are the other changes that have been proposed:
> the majority of directors on an insurer’s board of directors and key management persons would be required to be resident Indians;
> 50 percent of directors would need to be independent directors; and a specified percentage of the insurer’s profits would have to be retained as a general reserve.
During Budget 2021, Finance Minister Nirmala Sitharaman proposed allowing 74 percent FDI in insurance companies.
The draft rules will be published after 15 days, during which the finance ministry has invited suggestions.
(This is a developing story. Please check back for updates.)
