Parliament Clears Bill To Raise Insurance FDI To 100%

The Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025, was cleared by the Rajya Sabha through a voice vote, a day after it was passed by the Lok Sabha. The Upper House rejected amendments moved by the Opposition, including a proposal to refer the Bill to a parliamentary panel for further scrutiny.

Replying to the debate, finance minister Nirmala Sitharaman said the amendments would enable foreign companies to bring in more capital into the insurance sector. She said opening up the sector had already helped improve insurance penetration in the country and that there was scope for further growth.

The finance minister said increasing the FDI cap to 100 per cent would facilitate the entry of more foreign insurers, as many companies were unable to find suitable joint venture partners under the existing framework. She also expressed confidence that increased competition would lead to lower premiums for policyholders.

Addressing concerns over employment, Sitharaman said the move would, in fact, create more jobs. Citing data, she said employment in the insurance sector had nearly tripled since the FDI limit was raised from 26 per cent to 74 per cent. She also rejected Opposition claims that the Bill was being rushed through Parliament, stating that consultations had been held over nearly two years.

Earlier, several Opposition members opposed the Bill and demanded that it be referred to a parliamentary committee. During the debate, objections were also raised to the title of the legislation being in both English and Hindi.

Congress MP Shaktisinh Gohil said the mixing of languages in legislative business was not permissible. He also expressed concerns over the sharing of personal data such as Aadhaar and PAN details with foreign insurers and cited instances of digital financial fraud. He urged the government to reconsider the move and refer the Bill to a Select Committee.

BJP MP Arun Singh countered the Opposition’s criticism, alleging that past Congress policies had led to the collapse of several telecom and banking companies. He said the Opposition was trying to create confusion over the FDI provision and asserted that regulatory control would continue to remain with domestic authorities.

TMC MP Saket Gokhale objected to the Bill’s title and alleged that it would allow profit extraction by foreign entities. He sought clarity on commitments from foreign insurers regarding rural penetration and profit repatriation, and raised concerns about potential job losses and the impact on LIC and other public sector insurers.

DMK MP Kanimozhi N.V.N. Somu also opposed the Bill, citing figures on FDI inflows into the insurance sector. She claimed that increasing the FDI cap to 100 per cent would disproportionately benefit foreign investors and adversely affect domestic public sector insurers.

BJD MP Subhasish Khuntia, RJD MP Sanjay Yadav, CPI(M) MP John Brittas, IUML MP Haris Beeran, and BJP MPs Manan Kumar Mishra and Devendra Pratap Singh were among others who participated in the discussion on the Bill.