Ahead of the Budget,the insurance industry has urged the Government to move ahead with the proposal to raise foreign direct investment cap to 49 per cent and provide separate tax incentives for policies that have long tenures. "There has to be separate category for life insurance for encouraging long-term investments. So,we are not wanting short-term kind of tax benefit. The industry expects separate tax benefit for long-term products that have five years or more tenure," Metlife India managing director Rajesh Relan said. Such as move will promote long-term debt market in the country and help fund infrastructure,he pointed out. Max New York Life managing director Rajesh Sud said increase the FDI ceiling to 49 per cent can bring in the much-needed capital for the growth of the sector and long-term development. This will also enrich the business by bringing world-class business practices and processes,expand distribution capabilities and deepen market penetration,he added. Echoing similar views,Aviva India managing director TR Ramachandran said,"we would recommend a separate limit for deductions under Section 80C for long-term saving instruments like life insurance."
