FM admits differences within UPA on insurance reforms

Reported by Shahid K. Abbas and Saji George Titus, edited by Ranjana Chauhan/NewsWire18

Finance Minister Pranab Mukherjee admitted there are differences within the ruling coalition on crucial financial sector reforms in insurance and pension. "Some sort of broad political consensus on insurance, pension reforms is needed, and we are working on it. (There are) differences within the coalition on issues," Mukherjee said addressing the Hindustan Times Leadership Summit.

"We need to converge views within the coalition and outside the coalition, and we are trying for that," he said. Mukherjee said the ruling United Progressive Alliance does not have the required majority in the two houses bring in the legislations on insurance and pension sector reforms. Attempts by the UPA to bring insurance and pension reforms in the last term were stalled because of opposition from Left parties, which were supporting the government then.

The government has been planning to raise limit on foreign direct investment in insurance to 49% from 26%. Similarly, the government wants to allow entry of private sector in managing pension funds. Currently, only three public sector funds-LIC Pension Fund, SBI Pension Fund and UTI Retirement Solution are allowed to manage pension funds. But the regulator-Pension Fund Regulatory and Development Authority does not have a statutory backing, as the bill is yet to be passed by Parliament.

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