July 28, 2014
The chairman of India’s insurance regulator has expressed the hope that a proposed hike in foreign holdings in insurance companies, when effected, would lead to initial public offerings of the companies.
The chairman of the Insurance Regulatory and Development Authority (IRDA), Mr T S Vijayan, told reporters: “Now I expect insurance companies to get listed.” He said that details would be known once the Insurance (Amendment) Bill, that would effect the increase in the ceiling on foreign holdings in insurance companies from 26% to 49%, is passed by Parliament, reported the Press Trust of India.
The Indian Cabinet cleared the Bill last Thursday with the provision that management control of insurance companies will be in the hands of Indian nationals. Under the proposal, all investments in insurance companies beyond 26% will have to be approved by the Foreign Investment Promotion Board.
The next step is to table the amendment Bill before Parliament. Industry stakeholders are taking a wait-and-see approach for more details in the Bill.