New Delhi : The government may consider privatization Oriental insurance Or their financial health as United India Insurance Co. has improved after multiple capital infusions, people aware of the development said.
The government will hope to further strengthen their financial health ₹3,000 crore in public sector general insurance companies in the current quarter. Sources said both Oriental Insurance and Chennai-based United India Insurance may be able to attract interest from the private sector due to their improved finances.
The process of selecting suitable candidates for privatization has just begun and the decision will take some time, sources said, without denying the possibility of assurance of listed New India, where the government stake is 85.44 per cent. According to the plan, NITI will recommend to the government for privatization of ions and take up the proposal in a reasonable decision of the Department of Investment and Public Asset Management (DIPAM) under the Ministry of Finance.
Finance Minister Nirmala Sitharman in her Budget 2021-22 announced the privatization agenda of a big ticket, including the privatization of two public sector banks and a general insurance company. As part of a splitting strategy for the financial sector, India Life Insurance Corporation (LIC) decided to sell its mega initial public offering (IPO) and the remaining shares of IDBI Bank in early April. The government has budgeted ₹1.7575 lakh crore from sale of shares in public sector companies and financial institutions between 2021-22.
Last year, the Union Cabinet, headed by Prime Minister Narendra Modi, cleared a proposal to provide capital assistance to National Insurance, Oriental Insurance and United India Insurance. Cabinet decides to increase authorized share capital of National Insurance Corporation Limited (NICL) ₹500 crore and from United India Insurance Company Limited (UIICL) and Oriental Insurance Company Limited (OICL). ₹5 thousand crore each to implement the decision of capital infusion. At the same time the cabinet removed the previous budget proposal to merge NICL, OICL and UICICL.