Finance ministry is considering increasing FDI in insurance sector from 26 per cent to 49 per cent with few riders like restriction on voting right.
The government might raise the FDI cap in the sector initially beginning with non-life and health followed by life insurance segment. A proposal to raise the FDI cap in the sector was conceptualized by the previous United Progressive Alliance government and has been pending in Parliament since 2008. The ruling Bharatiya Janata Party had condemned raising the FDI cap in the insurance sector from 26 per cent to 49 per cent.
The Standing Committee on Finance had previously turned down the proposal, saying it may not have the required impact and could expose the economy to global vulnerability.