Economy
India Inc hails government's decision on insurance, pension funds

Corporates feel that the forward looking measures would infuse the much-needed capital in the insurance and pension sectors

 

New Delhi: India Inc has termed government's second wave of reforms, including decisions to open the pension sector to foreign investment and raising the foreign direct investment (FDI) cap in insurance to 49%, as 'path-breaking and landmark', reports PTI.

 

"The new instalment of big bang reforms is a clear message that the government is determined to strengthen the economy," FICCI President RV Kanoria said.

 

He said that these forward looking measures would infuse the much-needed capital in the insurance and pension sectors.

 

Kanoria also urged the government to make investment guidelines more flexible so that such funds can be used to support infrastructure development.

 

"Today, insurance and pension funds are constrained to participate in infrastructure projects as these are required to invest a substantial portion of their funds in government securities and also not allowed to invest in projects rated below a certain level. These limitations need to somewhat relaxed," he added.

 

Sharing similar views, CII said the industry was anxiously waiting for the clearance of the Companies Bill for its introduction in Parliament.

 

"The new company law is expected to be more streamlined and facilitative than the existing 55-year-old Companies Act, it seeks to replace," CII Director General Chandrajit Banerjee said.

 

Banerjee said on enactment, the Companies Bill will be a boon for business, corporates, investors and stakeholders at large.

 

"The new law would strengthen the concept of shareholders democracy and offer protection of the rights of minority stakeholders," he said.

 

Poor showing by the manufacturing sector pulled down the GDP growth to 5.5% in the first quarter, the decade's worst Q1 performance.

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Cabinet allows FDI in pension, hikes cap for insurance

In second wave of reforms decisions within a month, the Union cabinet cleared FDI in pension sector while hiking the FDI limit in insurance to 49%

Unfazed by the uproar over decision on foreign direct investment (FDI) in retail, the Union Cabinet on Thursday announced some big-ticket reforms like opening pension sector to foreign investment and raising FDI cap in insurance sector.

 

The Pension Fund Regulatory and Development Authority (PFRDA) Bill seeks to open up the pension sector to FDI of up to 26% while the Insurance Laws (Amendment) Bill seeks to raise the FDI cap in insurance sector to 49% from 26% at present.

 

This is the second wave of reforms decisions to be undertaken by the government within a month. On September 13, the government had approved the decision of allowing 51% FDI in multi-brand retail, besides relaxing FDI norms for civil aviation and broadcasting sector.

 

The decision on FDI in retail triggered a major uproar, with some allies and opposition parties launching a massive attack on the government. Trinamool Congress even withdrew support to the government.

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COMMENTS

M G WARRIER

5 years ago

Nice one. There is one aspect of the current trend in GOI action which mainstream media and most of us who keep a track of events affecting us are either ignoring or closing our eyes. That is the process of decision making which precedes deliberations and debates. Occasionally, MMS swears that ‘we are not influenced by external pressures’ (obviously such averments come when he himself finds pressures unbearable!). If the democratic process is not put back on track, we are heading towards a dead end from where diversion to any side will be suicidal.

MOHAN

5 years ago

Achievements of Congress

First Achievement ...... FDI in Politics !

then .....

FDI in aviation,

FDI in Broadcast

FDI in Multi-brand Retail

FDI in Single -brand Retail

FDI in Insurance

FDI in Pension

Consumers to spend less during festive season: Assocham

Over 70% of the country's middle and lower income families will be forced to cut spendings on festival in order to meet their monthly expenses first 

 
Mumbai: Almost 70% of the country's middle and lower income families will curtail their expenses during this festive season due to high inflation and less job avenues and salary packages, reports PTI quoting a study by Assocham.
 
"An overwhelming majority of middle and lower income families in the country will be forced to rip their spends this festive season than the last year mainly because of persistently rising inflation. They have slashed their festive budget to meet their monthly expenses first," Assocham said in a release.
 
Soaring vegetables prices pushed up the retail inflation in August to 10.03%, up from 9.86% in July.
 
But, the double digit food inflation and higher cost of borrowing did not affect the high income group, it said.
 
The study finds that last year, middle and lower middle income families, on an average, spent nearly 29% of their salary during festive season on shopping.
 
However, if incentive of discount is provided during the festive season, customers would spend more.
 
The survey, conducted in Delhi, Mumbai, Kolkata, Chennai, Ahemdabad, Hyderabad, Pune, Chandigarh and Dehradun, said over 78% people would spend more if discounts were offered.
 
"Over 78% of the respondents said that if they plan to spend higher, discounts will be the incentives for them," it said.
 
Over 68% of the respondents said they will spend 3% on gold items, 27% on sweets and clothes, 9% on vehicles, 8% on gifts, food and drinks, 12% on renovating the house and the rest 8% on electronics, the study added.
 

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