INDIA’S STATE INSURERS SEEK INVESTMENT RULE CHANGES

India’s state-owned insurers have asked the country’s ministry of finance to reduce the proportion of investment funds they must compulsorily invest in government-approved securities. Under current legislation, state-run reinsurer General Insurance Corp and others can invest only half of their funds in corporate bonds and shares, with the other half earmarked for mandatory government securities. Many of the country’s state-owned insurers have reported losses since recent market liberalisation opened the country up to foreign competition, and low yields from government investments are seen as partly to blame for their current plight. The ministry of finance has yet to respond to the request.