Union Finance Minister Nirmala Sitharaman in her Budget 2021-22 speech today (Monday, February 1) proposed to increase foreign direct investment (FDI) limit in the insurance sector from 49 per cent to 74 per cent.
Seen as a move aimed at attracting overseas players, Sitharaman proposed to amend the Insurance Act 1938 to "increase the permissible FDI limit from 49 per cent to 74 per cent in insurance companies and allow foreign ownership and control with safeguards".
"Under the new structure, the majority of directors on the board and key management persons would be resident Indians with at least 50 per cent of directors being independent directors and specified percentage of profits being retained as general reserve," she said.
In the first paperless Union Budget, Finance Minister Nirmala Sitharaman also said investor charter would be introduced as a right of all financial investors across all financial products.
At the beginning of the joint session of Parliament on Friday, PM Modi had also said that the Finance Minister had already announced 3-4 mini budgets and that the 2021-22 Budget would be a historic.
After an estimated 7.7 per cent contraction in 2020-21, the Economic Survey presented by Sitharaman on Friday has projected that India's real GDP would record a growth of 11 per cent in 2021-22. The nominal GDP growth has been estimated at 15.4 per cent, implying an assumption of 4.4 per cent inflation during the year.
Sitharaman had then asserted that this year's Budget will "be a Budget like never before."
It is expected that the Budget will help in revival by various sectors like agriculture, infrastructure, healthcare, rural economy and MSMEs sectors that faced the worst impact of the Covid-19 pandemic and lockdown restrictions.
(With input from agencies)
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