The Hindu : Karnataka / Mysore News : Increase in FDI cap in insurance sector opposed

Online edition of India's National Newspaper
Saturday, Jul 10, 2004

Karnataka

Karnataka - Mysore

Increase in FDI cap in insurance sector opposed

By Our Staff Correspondent

MYSORE, JULY 9. Members of Insurance Corporation Employees' Union, Mysore Division, today staged a demonstration here in protest against the increase in the limit of foreign direct investment (FDI) in the insurance sector.

Organised by the All-India Insurance Employees' Association, they opposed the proposal made in the Union Budget in this regard. The Union Finance Minister, P. Chidambaram, had proposed to increase foreign equity in the insurance sector from 26 per cent to 49 per cent.

They alleged that the proposal made it clear that the Congress-led United Progressive Alliance Government at the Centre had succumbed to pressure from international finance capital. They feared that the proposal would enable foreign insurance companies to transfer resources from India, and it would affect the country's economy adversely.

They also protested against the proposal to bring life insurance premium under the service-tax net. Imposition of service tax on premium would increase the burden on the common people. They demanded that such a proposal be withdrawn.

A press release said telegrams had been sent to Mr. Chidambaram urging him to withdraw these proposals. The Bangalore Region General Insurance Employees' Association has also opposed the increase in the limit of foreign direct investment. In a press release, it said a memorandum had been forwarded to the Prime Minister, Manmohan Singh, and Finance Minister, P. Chidambaram.

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