Home National News Bengal FM writes to Sitharaman against privatisation of insurance companies

Bengal FM writes to Sitharaman against privatisation of insurance companies

Bengal finance minister Amit Mitra said the move to privatise has brought a great sense of insecurity and distress among the people of the country. The privatisation of insurance companies will trigger a hydra-headed financial crisis while undermining the trust of common retail insurers in the lower portions of society.

August 3, 2021: Amit Mitra, the finance minister of West Bengal, wrote to Nirmala Sitharaman, the Union Finance Minister, requesting her not to proceed with the privatisation of insurance companies.

Privatisation of insurance companies

Amit Mitra claimed that the attempt to privatise has created a sense of uneasiness and distress among the country’s citizens.

“May I express my shock and alarm at the policy decision of the Government of India venturing to privatise public sector insurance companies which are the pillars of the economy,” Mitra said in the letter.

Privatisation-of-insurance-companies-Utkal-Today
Image: Google

Amit Mitra’s take and concern regarding privatisation of insurance companies

In the first instance, the government intends to privatise public general insurer United India Insurance Company, as well as sell off Life Insurance Corporation (LIC), which is seen as the fulcrum of financial security for the majority of Indians, he said.

Privatisation of the LIC, which has huge investments in the economy worth Rs 36.76 lakh crore, will open a “Pandora’s Box” he warned, putting 30 crore policyholders in jeopardy.

A disruptive and unstable future

According to Mitra, the privatisation of United India Insurance will cause significant disruption and destabilise the future of over two crore retail insurers.

According to him, privatisation will trigger a hydra-headed financial crisis while undermining the trust of common retail insurers in the lower portions of society.

Also Read: FM Nirmala Sitharaman announced economic packages for economic revival, raises ECLGS scheme limit to Rs 4.5 lakh crore

The Lok Sabha Bill

The Lok Sabha on Monday passed a Bill that will allow the government to privatise state-owned general insurance companies. The General Insurance Business (Nationalisation) Amendment Bill, 2021, was tabled in Lok Sabha on July 30. The Bill seeks to usher in more private capital into general insurance business and to help improve its reach and make more products available to customers.

The move is part of the government’s strategy to open up more sectors to private participation and improve efficiency.

The most important feature of the Bill is to drop the requirement in the existing general insurance law of 1972 that the central government will hold not less than 51% of the equity capital in a specified insurer. It also provides for cessation of application of the general insurance law to those insurers in which the government ceases to have control over.

Written by: Sugyani Mohapatra

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Solve : *
13 ⁄ 1 =


Most Popular

20 unique Indian wedding gift ideas

Indian wedding gift ideas are a great way to congratulate newlyweds and share your happiness with them as they begin a new...

Sanjita Mohapatra of Odisha secures the 10th rank in UPSC

Sanjita Mohapatra of Odisha made the state proud by winning laurels by securing the 10th rank in the prestigious Union Public Service...

‘Leading light’ goes out with demise of Jaswant Singh at 82

New Delhi, September 27: India’s veterans and political leaders mourned the death of the BJP veteran and former Union minister Jaswant Singh...

World’s most handsome person

Our world is full of beautiful people, but there are some who are just a class above and stand out in the...

Recent Comments