Vowing to continue with financial reforms agenda, Finance Minister Pranab Mukherjee said on Monday the government would push forward various legislations including those related to insurance and pension fund regulations.
"The financial sector reforms initiated during the early 1990s have borne good results for the Indian economy. The UPA Government is committed to take this process further," said Mukherjee in his Budget speech 2011-12.
The Government has set up a Financial Sector Legislative Reforms Commission under the Chair of Justice B N Srikrishna to streamline the financial sector laws.
"It would rewrite and streamline the financial sector laws, rules and regulations and bring them in harmony with the requirements of a modern financial sector. The Commission will complete its work in 24 months," said Mukherjee.
The finance minister said he proposed to move forward with various legislations, including Insurance Laws (Amendment) Bill, 2008; the Life Insurance Corporation (Amendment) Bill,
2009; and Banking Laws Amendment Bill, 2011.
The revised Pension Fund Regulatory and Development Authority Bill, first introduced in 2005, would also be taken up, he added.
Insurance Laws (Amendment) Bill 2008 seeks to hike the foreign direct investment cap in the insurance sector, currently pegged at 26 per cent, while the PFRDA Bill would give a legal backing to the interim regulator - the PFRDA.
The bill on LIC seeks to raise the capital base of the entity to Rs. 100 crore (Rs. 1 billion) from existing Rs. 5 crore (Rs. 50 million).
According to Mukherjee, the Bill on Factoring and Assignment of Receivables, the State Bank of India (Subsidiary Banks Laws) Amendment Bill, 2009; and Bill to amend RDBFI Act 1993 and SARFAESI Act 2002, would also be pushed forward.
Commenting on the proposals, ICICI Lombard's Managing Director Bhargav Dasgupta said: "The Finance Minister has given indication that he would go ahead with the reforms."
Another proposed legislation is the Securitisation and Reconstruction Of Financial Assets and Enforcement of Security Interest Act that would allow seizure of assets from defaulting borrowers to help banks reduce non-performing assets.