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BJP undecided on FDI in insurance, pension

Updated: October 4, 2012, 9:31 PM IST
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BJP undecided on FDI in insurance, pension
The party says only after it sees the fine print of the reforms, it will decide whether to support the measures or not.

New Delhi: In the wake of reforms announced by the government in insurance and pension sectors, the Bharatiya Janata Party on Thursday said while it is not opposed to more foreign direct investment in these areas certain caveats and conditions should be met to "safeguard the interest of the people".

However, the BJP remained ambivalent on whether it will support these measures in Parliament, saying it would first like to see the "fine print" of the reforms.

On the issue of FDI in insurance sector, BJP spokesperson Prakash Javadekar said the Parliamentary Standing Committee on Finance headed by Yashwant Sinha had gone into the issue and recommended 26 per cent FDI.

"Sinha was the first one to propose 49 per cent FDI in insurance 10 years ago. That time Congress had opposed it and since we wanted to bring a consensus, we agreed to 26 per cent. There are 16 members from the UPA in the Standing Committee on Finance and unanimously they have said it should be 26 per cent," Javadekar said.

He alleged the government has behaved in an "uncertain manner" on this issue.

Clarifying BJP's stand on the issue, Javadekar said "we are not opposed to FDI in insurance and pensions as we created it. Our concern is that many foreign companies have already invested more than 26 per cent through debenture-type
investments. Now, that will be converted into equity so no new FDI will come in."

BJP's other concern is that these companies have not penetrated the rural market as they were expected to and why IPO has not been allowed.

On pension, the BJP maintained the government ensures "sovereign guarantee of the pension fund for minimum returns of 8.5 per cent", protection of labour interest and security of the pension fund itself.

"We want the minimum return which the government gives of 8.5 per cent. There has to be a guarantee for this. You cannot allow people to play around with the hard earned money of the employees. That is why we want a definite discussion on
this," Javadekar said.

He insisted that the BJP is not opposed to FDI in the insurance and the pension sectors but these conditions should be met.

Asked about the BJP strategy in Parliament and outside it on these two reform measures, Javadekar did not give a categorical reply.

"Unless we see the fine print we cannot say as the Congress keeps changing its position on these issues umpteen times. As (former) finance minister Pranab Mukherjee had promised to look into our stand. But much has changed after him. This government is now only interested in political expediency to divert attention from corruption," Javadekar said.

He maintained that governance, transparency and infrastructure reforms are needed today. Reiterating the BJP stand that it will read the fine print and then come with a structured response, party's chief spokesperson Ravi Shankar Prasad said, "Earlier the two Leaders of Opposition, LK Advani and Yashwant Sinha had met former Finance Minister Pranab Mukherjee and conveyed to him
some of the concerns during the disucssions on this issue."

He said the BJP stands for the interest of the pensioners and the recommendations made by the Parliamentary Standing Committee.

First Published: October 4, 2012, 9:31 PM IST
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