Government is mulling a proposal to allow 49% FDI through automatic approval route in the insurance sector with a view to attracting more foreign inflows.
At present, FDI up to 26% is allowed through automatic approval route. For FDI up to 49%, the approval of the Foreign Investment Promotion Board is needed.
As per the sources, the government could publicize this decision in the forthcoming Budget as the move will help in raising ease of doing business also.
Currently, as many as 10 proposals, including that of ICICI Prudential Life, ICICI Lombard General Insurance and Aviva Life Insurance, are awaiting at different stages of clearances. The country receives maximum FDI from Singapore, Mauritius, the Netherlands and Japan.
In 2014-15, overseas fund inflows grew 27% to $30.93 billion as against $24.29 billion in 2013-14.