The Bhartiya Mazdoor Sangh (BMS) will strongly oppose the increase in foreign direct investment limit to 49 per cent from the current 26 per cent, and will protest if the government enforces it, said Vrijesh Upadyay, its general secretary.
On being asked, why the BMS is opposing FDI in the insurance sector, Upadyay said, "BMS has always been opposing FDI weather its in defence or insurance sector. More so in the insurance sector, because across the globe it is only in India where insurance companies are standing strong.
Look at what happened in the US to AIG during the financial crisis."
During the financial crisis in the US, AIG insurance went bankrupt and was unable to pay insurers. Then the question arose as to who will insure the insurer.
Upadyay said, "FDI limit in insurance till now is 26 per cent, increasing the stake of FDI to 49 per cent means handing over a significant portion of revenue to foreign companies, which will not benefit our nation in any way."
According to Upadyay, the Life Insurance Corporation of India (LIC) today runs the entire budget of the government, common man's hard earned money stays in the country.
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"Why hand over the common man's hard earned money to the foreign companies?" asked Upadyay.
He added, "The claim settlement track record of foreign companies is bogus. Indian insurance companies have the best claim settlement track record in the world."
Finally, he said, "So we will not allow the increase of FDI stake in insurance sector, BMS opposes the FDI in Insurance sector bill in its current form and will go to any extent to prevent it. If government chooses to impose it on us, there will nationwide strike in insurance
companies.
