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Cabinet approves up to 20% FDI in LIC under automatic route

The Cabinet has also further simplified and enhanced the existing FDI policy, government sources told CNBC-TV18 on February 26

February 26, 2022 / 03:22 PM IST

The Union Cabinet has approved foreign direct investment under the automatic route in the Life Insurance Corporation of India (LIC), government sources told CNBC-TV18 on February 26.

Up to 20 percent FDI will now be permitted under the automatic route in LIC and the existing FDI policy has also been “simplified and enhanced”, they added.

Notably, the FDI ceiling for public sector banks is 20 percent under the approval route, and a similar limit has been maintained for LIC. The choice of automatic route however is expected to expedite the capital raising process.

"The FDI reform will facilitate foreign investment in LIC and other such corporate bodies, for which the government may have a requirement for disinvestment purposes," the sources said.