ALL INDIA INSURANCE EMPLOYEES' ASSOCIATION
LIC BUILDING SECRETARIAT ROAD HYDERABAD
4TH OCTOBER 2012
TO ALL THE UNITS OF AIIEA,
ALL INDIA INSURANCE EMPLOYEES’ ASSOCIATION strongly OPPOSES THE GOVERNMENT’S DECISION TO APPROVE THE INSURANCE LAWS' AMENDMENT BILL AND PFRDA BILL.
THE MAJOR AMENDMENTS TO THE INSURANCE LAWS ARE (1) TO INCREASE THE LIMIT OF FDI IN INSURANCE SECTOR TO 49% AND (2) TO DISINVEST THE PUBLIC SECTOR GENERAL INSURANCE COMPANIES.
THESE MOVES ARE AGAINST THE INTEREST OF THE NATIONAL ECONOMY AND AGAINST THE INTERESTS OF THE PEOPLE WHOSE SAVINGS ARE INVOLVED IN INSURANCE AND PENSIONS.
INCREASE IN FDI IN INSURANCE WOULD LEAD TO THE INCREASED CONTROL OF THE FDI OVER THE SAVINGS OF THE PEOPLE OF INDIA.
The Parliamentary Standing Committee on Finance said in its report placed before the Parliament on 13th December 2011 that “There is no need to increase the limit of FDI to 49% as the government seems to have decided upon this issue without any sound and objective analysis of the insurance sector following liberalization”. Cautioning the government of the global financial crisis, the Committee has recommended to the government that the private companies may explore avenues to tap the domestic capital instead of increasing the FDI limits.”
When this is the unanimous recommendation of the Standing Committee, the cabinet decision to hike the FDI in insurance sector to 49% is clearly against all democratic norms.
The Insurance Laws (Amendment) Bill also provides for disinvestment of the Public Sector General Insurance Companies. AIIEA opposes this move since it would weaken the PSU General Insurance Companies and their strength to take up the social responsibilities. Instead, the government should merge the four PSU general insurance companies and make them a single monolithic corporation to meet the goals set by the government.
Similarly allowing FDI in Pension sector, would also make the pension funds vulnerable to exploitation by the foreign capital.
We call upon all the units of AIIEA across the country to hold powerful protest demonstrations during lunch hour tomorrow the 5th October 2012 and issue a press statement.
We also call upon all the insurance employees to be in readiness for a one day nation-wide strike if the government proceeds with enacting the Insurance Laws (Amendment) Bill in the Parliament.
Meanwhile, the units should continue their campaign against the FDI hike and the move to disinvest the PSU General Insurance Companies without any let up.
(K Venu Gopal)