BJP against more FDI in insurance, pension: Yashwant Sinha

MUMBAI: Opposition BJP in Maharashtra today said foreign investment in every sector was not a remedy to the current ills of the economy and it would oppose raising of FDI caps in insurance and pension sectors.

The BJP will oppose raising of foreign direct investment (FDI) cap from 26 per cent to 49 per cent in insurance and pension sectors, when it comes to Parliament, former Finance Minister and senior party leader Yashwant Sinha said here.

"If the government wants to raise FDI to 49 per cent both in insurance as well as in pension, then we will not be comfortable with that," he told reporters after a public lecture organised by a saffron outfit here.

"Let's not place our overconfidence in FDI as the panacea for all our ills, it has to be domestic demand and domestic savings," Sihna, BJP's lead spokesperson on economic affairs, said.

Incidentally, BJP-led NDA government had proposed higher FDI in these two sectors.

Sinha, who heads the Parliamentary Standing Committee on Finance, was replying to a question about reports in certain sections of the media on possible increase in FDI in the two sectors.

He said the Cabinet has prepared a note to raise the existing 26 per cent cap in both the sectors and is also preparing to move legislations to facilitate the same in the forthcoming Monsoon Session.

During his speech, Sinha, however, took a diabolical stand, prominently mentioning passing of reform legislations as one of the six points to come out of the present economic troubles.

Asked to elaborate on the reasons why the BJP is against the raising of the FDI cap, Sinha said a paper presented by his party had clarified its stance in the matter.

Along with reform legislations, Sinha suggested prudent fiscal management and addressing supply-side constraints to pull down inflation, which can help RBI lower rates, focus on the infrastructure and housing sectors and dealing with power sectors' troubles as the measures which can lift sagging spirits.