Govt push to 49% FDI in insurance

MUMBAI: Finance minister Pranab Mukherjee on Sunday said the government is talking to political parties to garner support required to push through a bill that allows 49% FDI in the insurance sector.

Speaking on the sidelines of an event to commemorate the centenary of , Mukherjee said: "We have started talking to various stakeholders which, in this case, are political parties because we do not have 272 Congress MPs. Therefore, we would require support of other political parties. I have started talking to them and I hope there will be a broad consensus in the matter."

He said the government has set up a Financial Sector Legislative Reforms Commission (FSLRC), which will have its first meeting in a few days to rewrite and clean up the financial sector laws and bring them in line with the requirements of the sector.

Later, talking to industry leaders at a conference organized by industry trade body Assocham, Mukherjee said that all the tax proposals in this year's Budget were aimed at aligning them with the Goods & Services Tax (GST). The FM also said that the GST has to align with the tax rates in different states in force now.

Mukherjee pointed out that the government wanted to undertake reforms to simplify and place administrative procedures concerning taxation, trade and tariffs and subsidies on electronic interface, which would be free of discretion and bureaucratic delays. "This would also prepare the ground for the implementation of the DTC and hopefully the GST as well, from April 2012," he added.

The FM said he was expecting companies to increase investments in return for higher margins that they enjoyed through Budget proposals like not going for any hike in excise duty. "Just as I have to meet your expectations to get you to scale new heights of productivity and growth, you also have to meet my hopes, in the process strengthening my hands."