Easing insurance FDI norms top priority: Chidambaram

Liberalising rules for foreign direct investment (FDI) in the insurance sector is a top priority for the Indian government, finance minister P Chidambaram told a Washington audience on Friday, adding that he hoped a bill addressing the issue would be passed in the upcoming session of Parliament.

Responding to questions at the Peterson Institute, Chidambaram appreciated the efforts of the insurance industry to reach out to the opposition parties, and hoped that this would help the parties understand issues and thus ease the passage of the bill.

''Parliament opens on 22 April. It (Insurance FDI) is right there at the top of the agenda. We are stuck on one clause, the FDI cap and whether it should be raised to 49 per cent. If the principle opposition party (the Bharatiya Janata Party) comes around, the bill will be passed,'' Chidambaram said.

''I am keeping my fingers crossed. I sincerely hope that the efforts of the insurance industry in speaking to the opposition are helpful and I can pass the bill,'' Chidambaram said.

Noting that without growth there will be neither inclusiveness nor development, he said, ''As long as the Congress is at the helm of affairs, I believe that they will accept growth is necessary in order to lead to inclusive development.

''Once you accept that paradigm, you have to accept fiscal deficit, you have to contain inflation, you have to contain expenditure, you have to balance your books to a large extent,'' Chidambaram said.

Responding to questions, Chidambaram said most state governments have now realised that implementation of programmes is the key.

''Until about 10 years ago, most state governments were not re-elected. If you were in office for five years, you were more or less certain to be defeated in the next election. That seems to have changed in India,'' he said.

''Incumbent governments are getting re-elected. The government at the centre got re-elected in 2009 with a larger number. Since then governments have been re-elected in Gujarat, Madhya Pradesh, Tripura Nagaland, Assam, Mizoram, Meghalaya, and Orissa,'' he said.