Hike in foreign ownership good for company: Analjit Singh

We have to go to FIPB. Bupa is committed and now with this event of today I hope it will be a few weeks and not few months.

Analjit Singh, Chairman, Max Healthcare, Chairman, Max Bupa Health Insurance Co while congratulating the government for passage of the Insurance (Amendment) Bill in Rajya Sabha said the company is now in a sweet spot since they have no obligation to their investors and would now have an additional 23 percent to play with.

With the passage of the bill foreign ownership limit into the sector has been hiked to 49 percent from the current 26 percent.

Below is the transcript of this interview with CNBC-TV18's Shereen Bhan

Q: It has finally gone through; the Rajya Sabha has cleared the Insurance (Amendment) Bill, what is your first reaction?

Singh: Fantastic news. It has been 15 years. Congratulations to the government in pulling this off, the previous Finance Minister tried very hard. This is a great signal to the world more importantly. So, let's leave our little limited and parochial interest out. Max is in a sweet spot because we have no obligation to our investors and we have now an additional 23 percent to play with. We have to read the fine print of course to understand finally what has come through between FII, FDI and so on so forth.

However the important thing is that India's image in the rest of the world with steps like this will be restored and I hope this gives the right message as the Prime Minister and Jaitley have wanted to do since they came into government.

Q: Let me talk to you specifically about your business because yours was the first corporate announcement after the insurance ordinance had been passed by this government. In fact Bupa had said and you have applied now for regulatory approval for Bupa to be able to hike its FDI in your health insurance business. Where do things currently stand as far as the regulatory approvals are concerned?

Singh: We have to go to FIPB. Bupa is committed and now with this event of today I hope it will be a few weeks and not few months. We have already all the arrangements in place with respect to our governance model and any changes in our joint venture. We were just waiting for this. It should happen in a few weeks.

Q: Let me ask you now about the life insurance business because your foreign partner Mitsui I would imagine is also interested in this new FDI cap and the new FDI ceiling. Any conversations with Mitsui and what can we expect there?

Singh: I am pleased to say that lots of conversations are going on and we had kept them warm because the past has been so uncertain and we have been in situations where we have sort of had to bite our tongue. So, we were waiting. There are multiple conversations going on and I think it should augur very well for the Max Group.

Q: Would that also mean perhaps that Mitsui could perhaps exit and you could get somebody else on board?

Singh: That is Mitsui's call. That option is not for us to call. They have been a very friendly, supportive partner. I would be sorry to see them go, but I don't know what they are thinking. They have said that we would like to leave the topic open for conversation, we have said very well. So I am not expecting or anticipating or even hoping that they would leave but we have got headroom and we are not by our contract not obliged or committed or contracted to reserve or give them a first option for 23. They know that very well. That was understood at the very initial stages of our joint venture. So we are open and free and obviously we will do our best for what is best for our shareholders.

Q: These multiple parties that you are in conversation for the life insurance ventures, are these European insurance players, US insurance players, who are you talking to without giving us names?

Singh: I have travelled to all these countries, that is the best answer I can give you.

For the entire conversation watch video

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