• Other proposals include increasing LIC’s paid-up capital from Rs 5 crore to Rs 100 crore and transfer of insurance ombudsman’s administrative control to the IRDA

• Already passed by the Parliamentary Standing Committee, the Bill is now with a group of ministers

Banking: Fair share of rights

• Banking Regulation (Amendment) Bill, 2005 has been pending in the Parliament because of stiff opposition from the Left parties and trade unions

• The most important proposal is to make the voting rights of shareholders in private sector banks equal to their voting shares

• Currently, voting rights of the shareholders are capped at 10 per cent, irrespective of their actual equity holding in the bank. Foreign investors can buy up to 74 per cent of a private Indian bank but their voting rights are capped at 10 per cent — a major deterrent for investors trying to gain management control

• The Bill is crucial as the second phase of opening up of Indian banking sector would commence in April 2009. As per this plan, foreign banks will have the opportunity to own up to 74 per cent of Indian private sector banks and 20 per cent of government-owned banks.

Pension: Spread it out

• The government had planned an ordinance for appointing a Pension Funds Regulation and Development Authority

• The Left objected and the ordinance lapsed

• The regulator is expected to break the monopoly of the Employees’ Provident Fund Organization (EPFO) in which both government and the private sector companies have to currently park their pension money

... contd.