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UPA’s return to push financial sector reforms

UPA’s return to push financial sector reforms
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First Published: Sat, May 16 2009. 04 50 PM IST
Updated: Sat, May 16 2009. 04 50 PM IST
New Delhi: Financial sector reforms are likely to get a push in the coming days, which were relegated to the back seat due to persistent opposition from the Left parties, with the Congress-led UPA set to form the next government.
“We have to see what the constitution of the new government is. Reforms would certainly get a push,” interim pension regulator PFRDA chairman D Swarup said.
Pension, insurance and banking sector reforms are there before the government, he said, adding, it is up to the government to decide whether to take on reforms together or pursue one-by-one.
The new government has to prioritise which reform to carry forward, the PFRDA chairman said.
Speaking about the PFRDA Bill, he said, the Bill has to be re-introduced in Parliament as it has lapsed.
The Pension Fund Regulatory and Development Authority (PFRDA) Bill was introduced by finance minister P Chidambaram way back in 2005 to replace the ordinance promulgated in 2004 for setting up the regulator.
The bill was referred to the Parliamentary Standing Committee after the Left parties opposed the legislation. The standing committee recommended the bill with some modifications.
But the amended bill could not be tabled in Parliament due to persistent opposition from the Left.
UTI chairman and managing director U K Sinha said, “I think it is a clear verdict for reforms.”
Financial sector reforms as well as disinvestment should take place, he said, adding it will be good for the sector and economy as a whole.
The coming Budget would highlight something to that effect, he added.
Last year, the government tabled the insurance reforms bill in the Rajya Sabha aimed at increasing the cap on foreign investment in private companies in the sector from 26% to 49%.
The minimum investment limit for health insurance companies is proposed to be fixed at Rs50 crore. At present, the companies entering in insurance business - life or general insurance - are required to have a minimum paid-up capital of Rs100 crore.
The move to lower the investment limit is expected to encourage companies with less capital to launch health insurance business and increase the penetration of this important segment of insurance business.
Finally, leadership honesty and execution are beginning to matter in politics. This is a values based victory for the country particularly at a difficult time like this, said Max India Group chairman Analjit Singh.
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First Published: Sat, May 16 2009. 04 50 PM IST
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