Buffett seeks higher FDI in Indian insurance sector

Keen to enter growing insurance sector, US billionaire Warren Buffett, who is here mainly to promote philanthropy, today wondered if India would raise the FDI limit in the sector to 49%.

The US based company is keenly watching the developments regarding further opening of the sector to foreign investment.

Legendary investor Buffett, whose group recently entered Indian insurance market, called on Irda Chairman J Harinarayan here and wanted to know if the FDI cap would be raised to 49%. Irda is the insurance regulator.

"Buffett wondered whether the foreign direct investment limit for foreign insurers could go up to 49% (from the present 26%)," Harinarayan told PTI after meeting chairman of conglomerate Berkshire Hathaway.

"The discussions were very general and was good," he said.

Buffett, known for his business acumen and choice of investments, said that India is an "an exciting market".

The Insurance Laws (Amendment) Bill, 2008 is pending in Parliament.

The Bill, when enacted, would allow raising the FDI cap for the industry to 49%. However, it has been awaiting approval since 2008 as it was delayed by strong opposition from the Left parties.

Berkshire Hathaway had recently forayed into the Indian non-life insurance sector as a corporate agent of Bajaj Allianz General.

On his maiden visit to India, Buffett had said that an foreign investment cap of 26% in insurance sector here was a deterrent.

Earlier in the day, Berkshire Hathaway head re-insurance Ajit Jain said the question of larger investments in the sector in India, "depends on regulation."

India-origin Jain, long rumoured to succeed Buffet, looks after the conglomerate's multi-billion dollar re-insurance business.

Yesterday Buffett along with Bill Gates, held a dinner meeting here with 70 business people, including Wipro Chairman Azim Premji and discussed a wide range of issues related to philanthropy.

As part of its India entry, the American conglomerate has incorporated Berkshire India to sell and distribute general insurance products in India. It would directly sell insurance to consumers through the portal 'www.Berkshireinsurance.Com' and by way of telemarketing.

Berkshire Hathaway is a sprawling conglomerate that has interests in various businesses, including property and casualty insurance and reinsurance, finance, manufacturing, and retailing.