AIIEA condemns FDI hike of 100% in insurance sector

Visakhapatnam: Representatives of the All India Insurance Employees’ Association (AIIEA) condemned the announcement of a hike in FDI limits in the insurance sector to 100 per cent from the present 74 per cent.

This decision, they termed it as unwarranted and carries with it serious consequences for mobilisation of precious resources for the development of Indian economy.

The AIIEA general secretary Sreekanth Mishra mentioned that the insurance sector was denationalised with the passage of the IRDA Bill 1999. This Act permitted the Indian capital to operate in the insurance industry in partnership with the foreign companies. The FDI was restricted to 26 per cent. But it has risen to 74 per cent since then. The AIIEA is of the firm understanding that allowing total freedom and greater access to foreign capital could only retard the orderly growth of the insurance industry with the focus more on profits rather than providing the people and business the much needed security.

There are also reports that the government intends to bring a comprehensive legislation amending the existing insurance laws. These amendments would take the country back to the pre-1956 situation which compelled the government to nationalise the life insurance business, Sreekanth Mishra emphasised.

The AIIEA representatives expressed their strong protest against the decision to hike FDI limit in insurance and demand its immediate withdrawal.