The government is planning to introduce a new law called The Insurance Laws (Amendment) Bill, which aims to bring big changes to how the insurance sector works in India. According to two people familiar with the matter, this bill is likely to be presented in Parliament during the monsoon session in July.
Originally, the bill was supposed to be introduced during the recent budget session, but it was delayed. The reason for this delay is that the finance ministry wanted to include some important changes, such as allowing 100% foreign direct investment (FDI) in the insurance sector. This means foreign companies would be allowed to own insurance companies in India fully, without needing an Indian partner.
Along with this, the ministry also wanted to make the business environment easier and more flexible for foreign investors, especially in terms of how they operate their insurance businesses in India. Since these changes are quite significant, they required new legal checks and approval. So, the revised bill had to be sent again to the law ministry for reviewing. After that, it needs to get approval from the Union Cabinet before it can be presented to Parliament and eventually become a law.
In short, the bill was delayed so that more investor-friendly changes could be added, and now the government is planning to bring it forward in the next Parliament session in July.
