49% FDI hike suicidal for country’s economy: NZIEA

Excelsior Correspondent
JAMMU, Dec 8: Describing UPA Government as the major threat to the people of the country for surrendering household savings of the country people to the major foreign companies and increasing Foreign Direct Investment in the country from current 26% to 49%, Northern Zone Insurance Employees’ Association has warned the major opposition parties and the people to strongly oppose this well planned move of  the Dr Manmohan Singh Government at the Centre.
Addressing a press conference here today, Divisional Secretary of the NZIEA, Pawan Gupta said that the UPA Government intends to pass the Insurance Laws Amendment Bill 2008 in the current Parliament session under the influence of foreign players. He disclosed that the said Bill proposes to increase FDI in the insurance sector from 26 to 49 %, which is suicidal for the economic sovereignty of the country.
He further pointed out that the provision for raising FDI cap to 49 % is to have a control on the household savings of this country by foreign companies  and not the development of infrastructure. This way, the household savings of the people of this country will not be safe in the hands of foreign companies. Majority of the  people of  this country are not aware of this fact and they must strongly oppose this move of the Congress led UPA Government at the Centre. The Association has warned the UPA Govt and resolved to observe one  day strike to strongly oppose the move.
Mr Gupta pointed out that argument of the Government that by promoting FDI in this country Insurance penetration  ( ratio of the premium underwrtitten to the GDP) will increase is not tenable. As per the reports of IRDA, the insurance penetration in India is 4.4 % despite very less disposable income of the people of this country whereas, the world average is 4%; USA 3.5 %, Australia 3.5 %, China 2.5 % and Brazil 1.5 %. As far insurance sector is concerned, the total FDI in life sector  (from 2001-2011) is only Rs 5723 crores whereas, for the same period LIC has paid dividend of Rs 7848.13 crore to the Governmnt. As on date, this investment in Government and social sector by LIC is Rs 921371 crores. The investment by LIC in the 11th Five Year Plan, is Rs 704151 crores  and in 12th Five Year Plan ( 2012-17) is Rs 183988 crores. Over all in the infrastructure development in the country’ LIC’s share is nearly 90%. It confirms that people’s savings is the only alternative as compared to FDI. He said that NZIEA will strongly oppose this move.