The government is going to make a fresh attempt to raise the foreign direct investment (FDI) limit in the insurance sectors to 49% from the current level of 26%.
The finance ministry is likely to move the Cabinet seeking approval for the insurance amendment bill, which seeks to raise the FDI ceiling to 49% and was introduced in Rajya Sabha in 2008.
The Parliamentary committee, headed by Yashwant Sinha, a senior member of the opposition party Bharatiya Janata Party (BJP), has been critical of raising the FDI cap on the sector, saying the move will amount to giving control of the country's robust financial sector to foreigners.
The proposal has been facing flak from all parties, particularly from the Left, which has questioned the rationale for raising the FDI cap "when domestic insurance companies were performing well".
In May, the Cabinet had deferred a decision on modifications to the insurance amendment bill.
Once the Bill, with the modifications, are approved by the Cabinet, it will have to be voted into law by Parliament in the face of stiff opposition from political rivals such as the Left parties as well key allies including Trinamool Congress Party led by West Bengal chief minister Mamata Banerjee.