PTI

New Delh: The much-awaited comprehensive insurance bill, which seeks to raise foreign direct investment cap in private sector to 49% from 26%, is likely to be introduced in the forthcoming session of Parliament.

The draft is being vetted by the Law Ministry and would be moved for Cabinet approval once it is cleared by the arance before the session begins, sources said.

Parliament session is scheduled to begin from 17 October.

Last month, a Group of Ministers headed by External Affairs Minister Pranab Mukherjee had cleared a proposal to hike FDI limit from 26% to 49%.

The proposed changes include amendments in the IRDA Act, 1999 and LIC Act, 1956 among others.

The UPA regime had proposed raising the FDI cap in its first budget in 2004-05. However, opposition from the Left parties forced the government to refer it to GoM in 2006-end.

The government failed to pursue the insurance sector reforms because of the pressure from Left, which were its allies.

However after withdrawal of support by the Left, the government took a conscious view to pursue the pending economic reforms, including those in the insurance sector.

Following opening of the insurance sector in 2000, about three dozen private companies have started operations in the country. Many of them are constrained by the 26% FDI and have been making a case for raising the foreign investment cap.