Revolutionizing Insurance: FDI Limit Raised to 100%

On Monday, Finance Minister Nirmala Sitharaman announced in Parliament a breakthrough decision to increase the Foreign Direct Investment (FDI) limit in India's insurance sector from 74% to 100%. This strategic move is expected to boost the sector's growth trajectory to 7.1% per annum over the next five years, potentially outpacing global growth.

The raised FDI cap eliminates the necessity for foreign entities to seek Indian partners for minority stakes, thereby simplifying the process for international insurers to establish their presence in India. This approach is anticipated to attract sustained foreign investments, enhance competition, and lead to improved insurance penetration across the nation.

Simultaneously, Sitharaman highlighted ongoing efforts to increase enrolment in government-backed insurance schemes such as the Pradhan Mantri Jeevan Jyoti Bima Yojana, Pradhan Mantri Suraksha Bima Yojana, and the Atal Pension Yojana. The government has launched a 'Financial Inclusion Saturation Campaign', aiming to enhance grassroots participation and financial literacy nationwide.

(With inputs from agencies.)