‘To say we are becoming regressive because we opposed FDI in one sector is not fair judgment’
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When as Finance Minister I had brought in the Insurance Bill originally, it had a provision that 26 per cent will be FDI and the balance 23 per cent could be held by FIIs, NRIs, overseas corporate bodies held by NRIs, etc. FDI could be to the extent of 49 per cent. When we discussed this with the Congress, they told us that on pain of death you will not raise it beyond 26 per cent. So we had to cut out that balance 23 per cent.
When we were told 26 per cent and nothing more, we restructured the whole thing. Which was, that to begin with, we'll have 74 per cent Indian partner, 26 per cent foreign partner and then, after these companies have operated for 10 years and reached a certain stage in the operational process, the Indian promoter will go to the market and disinvest his equity, bring it down to 26 per cent. So we envisaged a situation where the foreign promoter will hold 26 per cent, the Indian promoter will hold 26 per cent and the balance 48 per cent will be widely held through disinvestment or through IPOs in the stock market. There are many in the Congress who tell me that that is a much better arrangement than raising FDI to 49 per cent.
Surabhi: If the Congress chooses to bring the Insurance Amendment Bill with 49 per cent FDI, will you support it?
Yashwant Sinha: No, we will not and we have made it very clear to them to go by the Standing Committee's recommendations. The pension reform issue was taken up when I was Finance Minister. We are in favour of pension reforms. The government brought in a Bill to give statutory status to the Pension Fund Regulatory and Development Authority. That Bill did not go through because the Left opposed it. They brought back the Bill and we have given our recommendations and sent it to Parliament.