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Informist, Friday, Dec. 13, 2024

NEW DELHI – The UK has welcomed the Indian government's proposal to increase the foreign direct investment limit in the insurance sector, the Indian finance ministry said on Friday. The Department of Financial Services last month invited comments on a proposal to increase the foreign direct investment limit in insurance companies to 100% from the current cap of 74%.

 

On Thursday, the two nations discussed possible collaboration on central bank digital currencies and the possibilities of increasing cross-border investment as part of the third India-UK financial markets dialogue, which was held in Gujarat International Finance Tec-City. They also discussed digital payment connectivity, regulatory sandbox collaboration, future cooperation on other emerging technologies, including artificial intelligence and quantum computing.

 

Both the sides also explored further possibilities for increasing cross-border investment, including "through direct listings of Indian companies in GIFT IFSC (International Financial Services Centre) as a first step towards direct listing at the London Stock Exchange and other foreign jurisdictions in future", the finance ministry said in a release. Both the countries reflected on the emerging recommendations from the India-UK Financial Partnership Capital Markets Working Group report, which will be published at the next Economic and Financial Dialogue.

 

India updated the UK on its intention to introduce a climate finance taxonomy. Finance Minister Nirmala Sitharaman had announced in the Budget for 2024-25 (Apr-Mar) that the government would develop a taxonomy for climate finance to enhance the availability of capital for climate adaptation and mitigation. Department of Economic Affairs Secretary Ajay Seth had said in September that the government is likely to introduce the taxonomy for climate finance in the next six-eight months.

 

Both the sides discussed reporting, disclosures, and transition finance. India and the UK further discussed their recent sovereign green bond issuances and forward plans, the release said. "Both sides agreed on the need to continue engaging on sustainable finance, including through the next meeting of the India-UK Sustainable Finance Forum in early 2025."

 

"The Dialogue focused on collaboration in evolving fields of financial regulation, noting the areas of mutual interest in both markets for increasing bilateral trade and investment between the financial sectors," the release said.

 

The dialogue was led by senior officials from India's finance ministry and UK's treasury department. The dialogue included participation from regulators from the UK and India, including the Reserve Bank of India, the Securities and Exchange Board of India, Insurance Regulatory and Development Authority of India, and the Bank of England.

 

The UK welcomed the recent notification of pension schemes as financial products to be regulated by IFSCA, the release said. The UK also noted that insurance companies in GIFT-IFSC are allowed to invest overseas and the proposal to enable pension companies in GIFT IFSC to invest overseas is under consideration.  End

 

Reported by Shubham Rana

Edited by Akul Nishant Akhoury

 

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