To make the most of the monsoon session of Parliament, both the government and the Opposition (essentially the BJP) are negotiating a formula to infuse more foreign capital in pension and insurance sectors.
The two sides are seeking to break the deadlock on the long-delayed pension fund (PFRDA) and insurance Bills. The BJP has suggested it would consider an FDI cap of 49% in insurance, provided the voting right of the foreign fund be capped at 26%.
This offers hope for breaking the deadlock arising from government insistence on 49% FDI and the BJP’s stated position that FDI in the insurance sector be capped at 26%.
The government, sources say, is also mulling another way out: keep FDI at 26% but allow infusion of additional 23% foreign capital through FII route.
While negotiations continue on the insurance Bill, the government has accepted key BJP recommendations on the pension bill including capping of FDI at 26% and providing minimum assured return for the investors.
The BJP, however, has set general conditions for any legislative business.
“No Bills can be passed without the House being brought in order. They blame the opposition and say they want to run Parliament, but their members create disruptions, as you saw today,” BJP spokesperson Shahnawaz Hussain said.
The party raised this point in the Business Advisory Committee on Monday.
A senior UPA minister told HT: “We are expecting to pass the pension Bill towards the end of the session.”
In his recent overseas investors meets, finance minister P Chidambaram assured the Centre is keen to further liberalise pension and insurance sectors.