The Government of India is considering the approval of foreign investment regarding Life Insurance Corporation (LIC), the popular insurance company of India, but the Government of India has adopted a strict attitude towards Chinese investors. Actually LIC’s IPO may come after some time and the Government of India has full focus to stop Chinese investment in the shares of this IPO.
The Government of India is considering the approval of foreign investment regarding Life Insurance Corporation (LIC), the popular insurance company of India, but the Indian government has adopted a strict attitude towards Chinese investors. Actually, LIC’s IPO may come after some time and the Government of India has full focus to stop Chinese investment in the shares of this IPO.
Significantly, LIC is the largest insurance company in the country. LIC has over 60 per cent stake in India’s life insurance market with a net worth of $500 billion and the potential size of LIC’s IPO is said to be $12.2 billion. It is believed that this could be the biggest IPO of the country so far, but due to the tension between India and China, India does not want to give Chinese investors a chance to interfere.
Talking about this, a government official told news agency Reuters that after the conflict on the border between India and China, the situation has changed a lot and mutual trust between the two countries has decreased. Now it is difficult to do business like before. Chinese investment in a company like LIC can be risky. Significantly, the government is trying to raise Rs 900 billion by selling 5 to 10 percent of LIC.
Modi government can start foreign investment in FDI
According to reports, no final decision has been taken so far and it is not yet clear how India will stop Chinese investment in LIC as it will require India to modify the existing law on FDI. Under the current rules, no foreign investor can invest in LIC, but the Modi government is considering changing this rule in the coming times to reduce foreign investment in FDI to 20 percent.
Violent clash between India and China changed the situation
Let us tell you that there was a violent clash between the soldiers of India and China in the Galvan Valley last year. After this the tension between the two countries reached its peak. In this violence, 20 soldiers of India were also martyred. Since then, the Indian government had taken some steps to limit China’s investment in India and many Chinese apps were banned. On social media in India, people had appealed to people not to buy Chinese goods.
