Increasing FDI in insurance sector is top on UPA agenda: FM

Washington: Raising foreign direct investment cap in the insurance sector is top priority for the ruling UPA, Finance Minister P Chidambaram said today, hoping that a bill in this regard will be passed in the upcoming Parliament session.

Responding to questions at the Peterson Institute, Chidambaram appreciated the efforts of the insurance industry in reaching out to the opposition parties and hoped that this would help the political parties understand the issues and thus help in the passage of the bill.

"Parliament opens on April 22. It (Insurance FDI) is right there in top of the agenda. We are stuck on one clause, FDI cap whether it should be 26 or raised to 49. If the principal opposition party comes around, the bill will be passed," Chidambaram said.

"I am keeping my fingers crossed. I sincerely hope that the efforts of the insurance industry in speaking to the opposition will be helpful and I can pass the bill," Chidambaram said.

Noting that without growth there will be neither inclusiveness nor development, he said, "As long as the Congress is at the helm of affairs, I believe that they will accept growth is necessary in order to lead to inclusive development".

"Once you accept that paradigm, you have to accept fiscal deficit, you have to contain inflation, you have to contain expenditure, you have to balance your books to a large extent," Chidambaram said.

Responding to questions, Chidambaram said most state governments have now realised that implementation of the programmes is the key.

"Until about 10 years ago, most state governments were not re-elected. If you were in office for five years, you were more or less certain to be defeated in the next election. That seems to have changed in India in the last 10 years," he said.

"Incumbent governments are getting re-elected. The government in the centre got re-elected in 2009 with a larger number. Since then governments have been re-elected in Gujarat, Madhya Pradesh, Tripura Nagaland, Assam, Mizoram, Meghalaya, and Orissa," he said.