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CGNU, Dabur in Indian life insurance JV

British insurance group CGNU plc and the family that owns Indian consumer goods firm Dabur India said that they had signed a deal to develop a life insurance business in India.

The new venture, still to get approval from India's insurance regulator, aims to start business by mid-2001, a joint statement by the two groups said.

India threw open its insurance sector to private firms in 1999 after decades of state control and allowed foreign companies to hold up to 26 per cent in an Indian insurance company.

The remainder can be shared by one or more domestic partners.

The British group will invest 26 per cent in the new firm, Dabur CGU Life Insurance Company Ltd, while the Burman family, promoters of traditional medicine maker Dabur India Ltd, the rest, it added.

The statement, however, said investments in the life insurance venture by the Burman family would be made through other group companies and not group flagship Dabur India.

"Dabur would continue to focus on the core areas of health, personal care and foods," it said.

The venture is the second attempt by both groups to enter India's life insurance sector.

Dabur had earlier planned a joint venture company with US insurer Allstate Corp but the US firm pulled out in October, citing a change in its international strategy.

One of India's main print media firms, The Hindustan Times, was to partner CGU plc, but the publishing firm withdrew after it said it had reviewed its strategic objectives.

Several joint ventures like HDFC-Standard Life, American International Group-Tatas and New York Life Insurance-Max India, along with local firms like Reliance Industries have applied to enter India's life insurance sector.

CGNU plc is Britain's largest insurance group created in the middle of 2000 after the merger of CGU and Norwich Union.

The Dabur group, with total annual sales of Rs 12 billion is India's fifth largest consumer goods firm, the statement said.

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