CPI-M flays move to raise foreign investment in insurance

Expressing “shock” after the Congress-led coalition government on Monday introduced a bill to increase foreign investment in the insurance sector, the Communist Party of India-Marxist (CPI-M) said it would “harm the financial sector”.

Expressing “shock” after the Congress-led coalition government on Monday introduced a bill to increase foreign investment in the insurance sector, the Communist Party of India-Marxist (CPI-M) said it would “harm the financial sector”.

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“The Manmohan Singh government has introduced a bill in the Rajya Sabha to increase the FDI (foreign direct investment) cap in insurance sector from 26 to 49 percent. This is a shameless move to facilitate greater control of the insurance sector by foreign insurance companies,” said a statement issued by the party's politburo.

The United Progressive Alliance (UPA) government introduced the bill for the amendment on Life Insurance Corporation Act 1956.

“It is shocking that the Congress-led government is taking this step at a time when the financial crisis in the US has exposed the pernicious practices of the insurance and financial companies of the west,” the statement issued by Hari Singh Kang, a CPI-M central committee member, said.

Denouncing the move, Kang said the move by the Manmohan Singh government would "harm the financial sector and import the crisis into our system".

“This confirms the fact that this government is more interested in favouring international financial capital at the expense of the country's interests,” the statement said.

CPI-M said it extended “its full support” to the strike Dec 23 by the insurance employees against the bill, it said.