Anti-national decision to increase FDI in insurance sector by 100%: Mahapatra

Central Government should take it back

Raipur (Team Newsbuddy): Terming the NDA Central Government’s move to increase FDI limit in insurance sector from 74% to 100% in the budget as anti-national, insurance workers organised massive protests across the country demanding its withdrawal. On the call of All India Insurance Employees Association, these protests were organised in Raipur, Bhopal, Indore, Jabalpur, Satna, Shahdol, Gwalior, Bilaspur divisions of Madhya Pradesh, Chhattisgarh, besides 140 cities in central region and more than 2050 cities across the country and Modi government was demanded to withdraw this decision. Employees also organised protest meetings by raising slogans during lunch break in all the branch offices of LIC in Chhattisgarh. Addressing the demonstration organised in the divisional office, General Secretary of Central Zone Insurance Employees Association.

Dharmaraj Mohapatra said that the Finance Minister’s announcement to increase the FDI limit in the insurance sector from the current 74% to 100% was made through the Finance Bill, which means that this government does not want any discussion on this even in the Parliament. The government knows that there is no legitimate basis for this decision, so instead of giving any answer to it in the Parliament, it wants to pass it, whereas this will strengthen foreign control over the financial sources of the country.

This decision of the Government of India is completely unfair and it will hinder the mobilization of precious resources for the development of the Indian economy and the fulfillment of the state’s responsibility towards its citizens, which will have serious consequences. The national organization of insurance employees, All India Insurance Employees Association, has strongly condemned this decision of the government and has announced to create public opinion against this move. It is worth mentioning that with the passing of the IRDA Bill in the year 1999, the nationalization of the insurance sector was ended. This Act allowed Indian capital to work in the insurance industry in partnership with foreign companies. At that time the FDI limit was limited to 26 per cent; it has since been raised to 74 per cent. A large number of private insurance companies with foreign partners are operating in both life and non-life insurance industry. Capital has never been a constraint for these companies to run their business, as they are owned by large business houses that partner with the world’s top multinationals. In reality, the total FDI in insurance is only about 32 per cent of the capital employed. In this case, it is surprising why the government has taken the step of giving complete freedom to foreign capital to operate in India. This decision will have serious consequences for Indian companies and the Indian economy as well, if a foreign partner in a company decides to break away and form a new company. It will also lead to hostile bids by them to take over existing companies. Mahapatra said that giving complete freedom to foreign capital and greater access to our domestic savings i.e. financial source will hamper the systematic growth of insurance industry as their focus will be more on profits rather than providing necessary protection to common people and businesses.