BJP wants conditions for FDI in insurance, pension

In the wake of reforms announced by the government in insurance and pension sectors, the Bharatiya Janata Party on Thursday said that while it is not opposed to more Foreign Direct Investment in these areas, certain caveats and conditions should be met to "safeguard the interest of the people".

However, the BJP remained ambivalent on whether it will support these measures in Parliament, saying it would first like to see the "fine print" of the reforms.

On the issue of FDI in insurance sector, BJP spokesperson Prakash Javadekar said the Parliamentary Standing Committee on finance headed by Yashwant Sinha had gone into the issue and recommended 26 per cent FDI.

"Sinha was the first one to propose 49 per cent FDI in insurance ten years ago. That time Congress had opposed it and since we wanted to bring a consensus, we agreed to 26 per cent. There are 16 members from UPA in the Standing Committee on finance and unanimously they have said it should be 26 per cent," Javadekar said.

He alleged the government has behaved in an "uncertain manner" on this issue.

Clarifying BJP's stand on the issue, Javadekar said "we are not opposed to FDI in insurance and pensions as we created it. Our concern is that many foreign companies have already invested more than 26 per cent through debenture-type investments. Now, that will be converted into equity so no new FDI will come in."

BJP's other concern is that these companies have not penetrated the rural market as they were expected to and why IPO has not been allowed.

On pension, BJP maintained the government ensures "sovereign guarantee of the pension fund for minimum returns of 8.5 per cent", protection of labour interest and security of the pension fund itself.