'India should speed up insurance sector reforms'
New Delhi: A global body of insurers Tuesday said India should speed up reforms in insurance sector, which would help in attracting more foreign funds.
"Coalition of global insurers with substantial investments in India has made a strong plea to the Parliament and India's leadership to pass the Insurance Amendment Bill before this Parliament session ends," Washington based Albright Stonebridge Group said in a statement.
Recent reports that the much-delayed Insurance Bill is unlikely to be passed by the Indian Parliament in its current session should be a cause of great concern to everybody, it said.
"If the Insurance Bill does not pass through the Parliament in the current session, the global investment community may read it as a lack of interest on part of its policy makers to do what needs to be done to avert a bigger crisis," Frank Wisner, former US Ambassador to India, was quoted as saying in the statement.
He has been leading this coalition of global insurers advocating for increased FDI in insurance, it added.
The Insurance Amendment Bill to raise FDI cap in the insurance sector from 26 percent to 49 percent has been pending in the Rajya Sabha since 2008.
"It is imperative that the proposed Bill...Is accepted since it is widely seen by the foreign investment community and governments as a key reinforcement of India's commitment to financial and economic reforms," the release said.
Former Country Head and CEO of AIG India Sunil Mehta said that any further delay in pushing insurance reforms will exacerbate the risk of losing this capital to other competitive markets.
For a country with a GDP that is about to touch USD 2 trillion, India has woefully inadequate insurance coverage, the statement said, adding, only 6 percent of the 1.25 billion Indians have life insurance and only 5 percent of has health cover.
It further said India's insurance industry needs around USD 12 billion in capital up to 2020 and opening up the insurance sector to higher FDI will greatly enhance the industry's reach to semi-urban and rural markets.
"We urge India's political parties to join hands in the interest of the nation, its economy and its people and push the bill through Parliament in the current session," Wisner added.
Albright Stonebridge Group is the premier global commercial diplomacy firm.