To facilitate privatisation of a public sector general insurance firm, the government is working on amendments to the General Insurance Business (Nationalisation) Act (GIBNA). The amendments to the GIBNA are being worked out and may be tabled in the upcoming monsoon session which is expected to begin from 19th July, 2021.
Finance Minister had announced privatisation agenda, including privatisation of two public sector banks and one general insurance company in Budget 2021-22.
As part of the divestment strategy for the financial sector, the government has decided to go for a mega initial public offering (IPO) of Life Insurance Corporation of India (LIC) and residual stake sale in IDBI Bank during the financial year beginning April.
The government has budgeted Rs 1.75 lakh crore from stake sale in public sector companies and financial institutions during 2021-22.
However, last year, the Union Cabinet, cleared a proposal to provide capital support to National Insurance, Oriental Insurance and United India Insurance.
The Cabinet had also decided to increase the authorised share capital of National Insurance Company Ltd (NICL) to Rs 7,500 crore and that of United India Insurance Co Ltd (UIICL) and Oriental Insurance Co Ltd (OICL) to Rs 5,000 crore each to give effect to the capital infusion decision. At the same time, the Cabinet junked the earlier Budget proposal of merging NICL, OICL and UIICL.