On 27 April 2020, the Ministry of Finance notified the
long-awaited Foreign Exchange Management (Non-debt Instruments)
(Second Amendment) Rules 2020 (NDI Amendment) to permit 100%
foreign direct investment (FDI) in insurance intermediaries under
the automatic route.
Background
The Department for Promotion of Industry and Internal Trade
through Press Note No. 1 (2020 series) dated 21 February 2020
brought in amendments to the consolidated FDI Policy of 2017 to
permit 100% FDI in insurance intermediaries. The NDI Amendment has
been introduced in furtherance of this press note.
The liberalisation to allow 100% foreign shareholding in
insurance intermediaries started with the introduction of the
Indian Insurance Companies (Foreign Investment) Amendment Rules
2019 (FI Amendment Rules) on 2 September 2019. After the
introduction of the FI Amendment Rules, Insurance Regulatory and
Development Authority of India (IRDAI):
