Government amends rules to allow 20% foreign direct investment in LIC


  • The government has amended rules of the Foreign Exchange Management Act (FEMA), paving the way for up to 20 per cent foreign direct investment in the LIC.
  • The government is planning to dilute its stake in LIC through the Initial Public Offering (IPO).
  • The foreign inflows' ceiling for public sector banks is 20 per cent under government approval route as per the present FDI policy, it has been decided to allow foreign investment of up to 20 per cent in LIC and other such corporate bodies.

Facts to Know:


  • Foreign direct investment (FDI) is when a company takes controlling ownership in a business entity in another country.
  • The objective of FEMA act was “facilitating external trade and payments and promoting the orderly development and maintenance of foreign exchange market in India”.
Life Insurance Corporation of India
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