Joint Secretary with the Department of Economic Affairs of Ministry of Finance Anup Pujari told reporters on the sidelines of a business summit organised by AMCHAM, here on Saturday, that the FDI cap of 26 per cent in the insurance sector would stay for the moment.

Asked what view the government was taking on lifting it to 49 per cent as sought by insurance companies, Pujari said that the 26 per cent stake is not small. Pujari, however, said that it was under consideration for a while, adding that everything would depend upon emergence of a political consensus. When pointed out that insurance companies would need capital for expansion, he said that there was no dearth of capital in any sector.

Although 80 per cent of the FDI routed to India came  through the automatic route, the government had put sectoral caps on insurance, banking and telecom. Pujari said that the government was open to any amount of money inflow into the country either through FDI or portfolio investments route. He, however, said that the idea was to encourage more FDI rather than portfolio investments. Talking about outward investments, he said that the government was of the view that Indian companies should make assets abroad.

Pujari said that the government would encorage this and help Indian companies transform into multinationals. On appreciation of the rupee,  he said that this might have made exporters unhappy, but the government had been able to contain inflation.