The Lok Sabha on Monday passed the Life Insurance Amendment Bill, 2009. It will enable the LIC to raise its minimum capital to 100 crore rupees from 5 crore rupees as at present. This is the first financial sector reform Bill moved by the Government. The Finance Minister, Mr. Pranab Mukherjee had introduced the legislation on Friday last. The

Bill brings the LIC at par with the private insurers who need a minimum paid up capital of 100 crore rupees to begin their operations. The Amendment will provide sovereign guarantee to the LIC policies. Replying to the discussion, the Minister of State for Finance, Mr. Namo Narayan Meena said, the government does not intend to dilute its holdings in the LIC. Despite the entry of the private sector players in the business about 10 years ago, the LIC continues to be the market leader in insurance, he said.

The passage of the Bill was preceded by a division on one of its clauses by a Left Front member. In the voting, his objections were negated by 107 votes to 17 with six abstentions. This led to a walkout by the Left Front members.