NEW DELHI: The Union Cabinet today approved memorandum of understanding between Insurance Regulatory and Development Authority of India and the US Federal Insurance Office.
The MoU provides a framework for cooperation and coordination, including for the exchange of information and research assistance with respect to each authority’s overview and other lawful responsibilities, an official statement said after the Union Cabinet chaired by Prime Minister Narendra Modi approved the agreement.
Under the agreement, both the countries intend to share their experiences on various regulatory functions and to provide mutual assistance, including training activities, it said.
India and the US have also agreed to continue to facilitate cooperation on international standard-setting activities, financial stability and the development and implementation of consumer protection through sound prudential regulation of the insurance sector, the statement added.
IRDAI is a body set up under the Insurance Regulatory and Development Authority Act, 1999 to regulate, promote and ensure orderly growth of the insurance and re-insurance business in India. Similarly, in the US, Federal Insurance Office (FIO) is vested with the authority to monitor all aspects of the insurance sector and to represent the country on prudential aspects of international insurance.
India and the US have strong business relations and both the countries have been in regular discussions at various political and official levels, the statement said.
Various institutional mechanisms have also been put in place over time to strengthen bi-lateral cooperation on wide ranging multi-sectoral issues between the two countries, it added.
The US is one of the major contributors of foreign direct investment in India and many insurance companies have set up joint ventures with US-based insurance companies.
With increase in foreign investment cap to 49 per cent, there is further scope for foreign investments in Indian insurance sector particularly from US-based companies. Hence the bilateral MoU between IRDAI and FIO, USA holds lot of potential for the two countries, it said. (AGENCIES)
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