The Centre is considering to permit foreign direct investment (FDI) in the Life Insurance Corporation of India (LIC), which is headed towards a massive initial public offering (IPO), a report said on August 24.
The move, which is being contemplated over by the government, may allow a single overseas investor to buy a large stake in the state-run insurer, which has a market share of around 66 percent.
A person privy to the development, who told Bloomberg that the government may allow FDI in LIC, also noted that any strategic investment would be subject to a cap. However, it was not clear at what level the cap would be set, the source added.
Although 74 percent FDI is permitted in the insurance sector, the norm does not apply to LIC so far as the company is a special entity formed through legislation passed in the Parliament, the person was reported as saying.