India approves 20% FDI for LIC $8b IPO—report

IPO is set to launch in March.

India’s cabinet has approved a policy amendment allowing foreign direct investments (FDIs) of up to 20% in state-owned insurer Life Insurance Corporation, a report by Reuters said.

India is set to sell 5% of its shares in March to raise $8b.

ALSO READ: India state-run LIC files $8b IPO papers

The amendment would allow foreign direct investors to buy 20% of LIC’s shares through an automatic route.

In India’s current rules, FDIs is not allowed in LIC, which is governed by the special parliament act, whilst 74% foreign direct investment is allowed in other private insurance companies.

 said the government source, who spoke on condition of anonymity after the cabinet meeting.

Under current rules, foreign investment is not allowed in the LIC, governed by the special parliament act, while 74% foreign direct investment is allowed in other private insurance companies.

The amendment would allow the government to raise the foreign direct investment limit in the LIC up to 20%, on par with the rule for state-run banks, the report said.

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