Govt working on amendments to GIBNA for insurance PSU privatization

With an aim to facilitate privatisation of a public sector general insurance firm, the government is working on amendments to the General Insurance Business (Nationalisation) Act (GIBNA), and a Bill for that is likely to come up in the upcoming monsoon session. The monsoon session is likely to begin from July 19.

The Act, which came into force in 1972, provided for the acquisition and transfer of shares of Indian insurance companies and undertakings of other existing insurers in order to serve better the needs of the economy by securing the development of general insurance business.

Finance Minister Nirmala Sitharaman in Budget 2021-22 had announced a big-ticket privatisation agenda, including privatisation of two public sector banks and one general insurance company.  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.