New Delhi : After the rigid political battles over the Coal Mines and the Mining Regulations bills, which were sent to the select committee of the Rajya Sabha on Wednesday, there was a tinge of bipartisan consensus for the government’s economic reform agenda on Thursday.
This manifested in the long pending Insurance Law Amendment Bill, which provides for raising the foreign investment cap to 49 percent in this sector, being passed by the Rajya Sabha.
The Lok Sabha had already passed the Bill, and this paves the way for the necessary amendment to come in force. It is expected to draw foreign investments worth thousands of crores in the insurance sector.
It was easy for the Congress, the main opposition, to support this amendment, as it had moved the original Bill in 2008. It had failed to muster support from the BJP at that time. Besides, the option of sending the Bill to a select committee could not be exercised this time, as it had been exhausted in the past. So, with the government accepting a few suggestions made by senior member Anand Sharma, a former commerce minister, the Bill got the requisite support as the Congress came on board.
The Bill, which replaces an Ordinance promulgated in December last, was passed by voice vote after walkout by the Trinamool Congress and the DMK. The ruling NDA is in a minority in the Rajya Sabha, and the passage of the Bill was facilitated by the support of opposition parties like the Congress, the AIADMK, the NCP and the BJD besides allies Shiv Sena and the Akali Dal.
In defence of the Bill, the minister of state for finance Jayant Sinha said that the measure was necessary for expanding the penetration of insurance in the country which is very low at present. He added that it would go beyond life insurance to cover other aspects like health and crops besides providing more funds for development of infrastructure.
He assured the members that the premium will not flow out of the country but will remain within the country and the interests of policy holders will be protected by the IRDA. He also sought to allay apprehensions that state-run LIC would be hurt if foreign companies come in, saying it was a very competitive body and can match global players. At the same time, he said the country needs not one, but five to 10 LICs.
The backdrop for the ‘deal’ on the insurance Bill was provided at a meeting Union Finance Minister Arun Jaitley had with leaders of all parties on Wednesday morning. At that meeting, a bipartisan give and take emerged where the Congress indicated its willingness to support insurance Bill after the government agreed to the demand for referring the Coal and Mines Bill and the Mines and Minerals Bill to the Select Committee. “Insurance bill is different. It has gone through the Select Committee. There could be unanimity on insurance,” said a senior leader from the opposition camp.