DPIIT will come out with revised FDI policy to facilitate LIC disinvestment: Secretary

Anurag Jain, Secretary, Department for Promotion of Industry and Internal Trade (DPIIT), said the existing policy relating to this sector will not facilitate LIC’s disinvestment process and hence, it needs to be revised.

“We are working on further simplification of FDI policy. A very important point is urgently needed for further simplification as we have to disinvest LIC. Hence, we will bring in a revised FDI policy which will facilitate LIC disinvestment.” He told reporters here.

The matter is being discussed with the Department of Financial Services and the Department of Investment and Public Asset Management (DIPAM).

“We have had two rounds of discussions at our level and now, we (DPIIT, DFS and DIPAM) are on the same page. So, we are in the process of drafting those changes in the FDI policy. We will go to the cabinet. (for approval),” he said.

As per the current FDI policy, 74% foreign investment is allowed in the insurance sector under the automatic route. However, these rules do not apply to Life Insurance Corporation of India (LIC), which is administered through a separate LIC Act.

As per SEBI regulations, both FPI and FDI are allowed under public offering. However, sources said that since there is no provision for foreign investment in the LIC Act, the proposed LIC IPO needs to align with SEBI’s norms regarding participation of foreign investors.

The cabinet had approved the initial public offering (IPO) of LIC in July last year and stake sale is being planned in the current March quarter.

Further, talking about the long pending e-commerce policy, the secretary said that DPIIT is in the final stages of “touching up” the e-commerce policy and the National Retail Trade Policy.

The e-commerce policy has been finalized at my level and we have circulated it to other departments. Now we will have a high level discussion… we will discuss that with the departments and then we will finalize it. .. a lot of work has been done”, he said.

He said that FDI is allowed only in the marketplace model and I don’t see any change in it.

Asked about the availability of oxygen as the number of COVID-19 cases is increasing in the country, he said the government is well prepared and “we can meet the demand of up to 19,000 metric tonnes”. .