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Why a big NO to FDI in Insurance?
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Prof. Surojit Mazumdar of Jawaharlal Nehru University while talking to Newsclick , is allowing Indian savings to be go to foreign companies. The record of foreign companies, particularly in insurance, is one of aggressive wooing of customers, not paying them under various pretexts and using this money for speculative purposes. This is their “efficiency”, which the public sector insurance companies cannot match. Without regulation, these companies play in the market as American Insurance Group (AIG) did and get bailed out if their speculations fail. As we know, 49% is more than enough to control companies and therefore this is method of handing over control of Indian peoples savings to foreign hands and financial liberalisation. This is dangerous for the Indian economy.
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