The old and cliched adage, ‘act in haste, repent at leisure’, perhaps best sums up the Narendra Modi government’s headlong rush to sell a portion of its stake in India’s premier life insurance company, the Life Insurance Corporation of India (LIC).
The Modi government’s handling of India’s biggest-ever IPO shows an extraordinary disregard of public interest, while pandering to the whims and fancies of global speculators who have bargained hard to get the shares at a heavily discounted price. The government’s egregious disregard for the interests of millions of policy holders, who have been instrumental in developing and nurturing not just LIC but the culture of life insurance in India, while favouring a handful of international speculative interests, has only confirmed the suspicion that the LIC float has all the hallmarks of a gigantic scam — perhaps, the biggest in the annals of privatisation in India.
On Saturday, April 23, the LIC Board, clearly under pressure from the Union Finance Ministry, decided to lower the extent of the planned disinvestment, from 5% to 3.55%. On April 26, the LIC Board met to formally decide on the launch dates of the float as well as the extent of discounts on the issue price that are to be offered to policyholders and employees, as well as other details. The LIC is expected to file its formal Red Herring Prospectus with the market regulator, the Securities and Exchange Board of India (SEBI), on April 27. The details are…
