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Interview of Shivaji Dam,
CEO,
OM Kotak Mahindra Life Insurance Company
On Budget 2004-05
What is your opinion about Budget 2004-05?
Overall a good budget. Will drive growth and also boost
the rural economy.
What benefits has it brought for the insurance
sector?
As far as benefits for the insurance industry is concerned
there is one positive and negative aspect. The positive
aspect is that the FDI has been increased from 26 percent
to 49 percent. This will enable our foreign partners to
bring in additional capital for expansion.
The negative aspect is that the service tax has been hiked.
This will increase the cost of insurance adding to the premium.
Besides it will also affect the administration of collection.
Also the tax on single premium policies has not been addressed.
Insurance is a long term contract and such quick changes
have their own repercussions
What will be the implications of the hike in FDI
for your company?
Right now I cannot say anything because these things have
got to be worked out on paper.
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