New Delhi: The Department of Industry and Internal Trade (DPIIT) on Tuesday issued a notification of the government’s decision to increase the foreign direct investment (FDI) in the insurance sector from 49 per cent to 75 per cent. According to a press note issued by the department, the decision will be effective from the date of FEMA (Foreign Exchange Management Act).
The Insurance Amendment Bill, 2021 was passed by the Parliament in March. The Insurance Act, 1938 was amended by the bill. FDI in the insurance sector was increased from 26 per cent in 2015 to 49 per cent. The announcement to increase the FDI limit was made on 1 February in the Union Budget 2021-22.
This new arrangement is expected to benefit 23 private life insurers, 21 private non-life insurers and seven specialized private health insurance companies.
