Insurance Bill moved in RS

He said the antiquated provision existed as the 1938 Insurance Act had never been fully amended and only certain amendments were carried out in 1956 when LIC was nationalised and in 1976 when GIC was brought under Government control.

Sinha assured the House that the Government would take suitable measures for strengthening the LIC and GIC which have contributed significantly to the economy.

He said foreign companies would not be allowed to hike their equity in the country through their Indian subsidiaries adding the MRTP Act would also safeguard this.

As many as eight amendments were moved by members seeking to refer the IRDA to a select committee in Rajya Sabha for bringing in various changes including removal of the clause for investment in securities in the United Kingdom.

Many of the amendments were sought by members belonging to left parties.

Initiating the discussion on the IRDA Bill, former finance minister Pranab Mukherjee said the LIC, GIC and its subsidiaries have not been able to tap the full potential of the insurance market and new players would be able to help generate resources for the infrastructure sector.

On foreign participation in the sector, he said it was not necessary that these companies would avail of the full 26 per cent equity participation and it could also be less.

Mukerjee however sought an assurance from Sinha that Parliament would have close linkages with the sector saying the statutory authority for insurance would be independent and it would be left for the Minister or the representative of the government to explain the developments in the sector to the house.

Mukherjee called for consensus on the legislation and asked the government to provide transparent insurance sector guidelines.

He told members that the Congress election manifesto for the 13 Lok Sabha elections had outlined measures for reforms in the sector.