Ever since the government started its disinvestment programme, LIC has emerged as the unofficial underwriter of its disinvestment programme. If there are no takers for the government’s shares from the savvy investors, LIC – with its huge corpus - always steps in to buy the shares at the price determined by the government. If the market value of these shares fall post disinvestment, LIC has come up with a handy solution to say “we are a long term investor.” There is no other explanation from the insurance giant. LICs investments are often opaque with no accountability and LIC policy holders seldom get access to investment decisions by the Corporation. As the premium collected by the LIC goes into a huge corpus, it is very difficult to make out whether any particular investment decision is a dud or a winner. It’s high time LIC investment decisions are made public. LIC thinks its investment decisions are price-sensitive but then it should learn from other pension and investment funds of the world like Calpers and Childrens Investment Fund – which publishes details of its investments. As LIC is controlled by the Indian government, insiders say it’s the finance ministry which asks LIC to make a particular investment and also asks it to keep quiet when things go wrong with private sector companies. Few years ago there was a CBI raid on LIC. The CEO of LIC Housing Finance was even arrested. But CBI failed to file a chargesheet and the CEO re-joined LIC. The former LIC chairman - who was demoted to MD - was later made the Chairman of IRDA. This just shows how LIC has become a puppet in the hands of political masters in Delhi.
Posted on: Sun, 02 Nov 2014 07:37:38 +0000
Trending Topics
Recently Viewed Topics
© 2015