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FEMA Rules Amended to Allow for 20 % FDI in LIC

Published on April 14, 2022
Current Context: Ahead of the mega-IPO of the largest insurer in the country, FEMA rules have been amended to allow 20% FDI in LIC through IPO.
FEMA Rules Amended to Allow for 20 % FDI in LIC
  • DPIIT ( Dept for Promotion of Industry and Internal Trade ) has relaxed the FEMA rules to allow 20% investment through FDI.
  • LIC is slated to undergo Initial Public Offer, therefore, to attract maximum subscription and diversify the basket of investment, DPIIT has taken this decision.
  • Though an amendment can only be brought about through parliamentary procedures, the provision of delegated legislation, however, makes it possible for the executive to make changes to existing law.


Q.1 What is the permissible limit of investment through FDI in LIC IPO, as brought out by DPIIT by amending FEMA (Foreign Exchange Management Act)?
a. 15%
b. 25%
c. 21%
d. 20%

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