3 weeks ago
AIIEA condemns Centre's decision to dilute LIC stake via OFS
The Life Insurance Corporation of India, or LIC, is a big insurance company that is mostly owned by the government.
The government wants to sell some of its shares in LIC to the public and stock market investors.
This is called an offer for sale, or OFS.
A group of insurance workers called AIIEA is not happy about this plan.
They say LIC belongs to the people of India, not to the stock market.
The government says it must sell shares to meet a rule that requires at least 10% of LIC to be owned by the public by May 2027.
The workers think the government is just selling public assets to fix its money problems.
That is why AIIEA members held lunch-time protests on Wednesday.
They want the government to stop the share sale and give up its policy of piecemeal privatisation.
The All India Insurance Employees' Association (AIIEA) condemned the Government of India's decision to dilute its stake in LIC through an offer for sale (OFS).
The OFS comprises a base sale of 2.5 per cent of LIC's paid-up equity plus a green shoe option of 4 per cent, allowing disinvestment of up to 6.5 per cent.
The government justified the move by citing the SEBI requirement of achieving a minimum 10 per cent public shareholding by May 2027.
AIIEA general secretary Shreekant Mishra said the government is selling public assets to bridge its fiscal deficit.
AIIEA members held lunch-hour demonstrations across the country on Wednesday demanding withdrawal of the proposed OFS.
- Who
- The All India Insurance Employees' Association (AIIEA), led by general secretary Shreekant Mishra, opposing the Government of India
- What
- A plan to dilute the government's stake in LIC through an offer for sale (OFS) of up to 6.5 per cent of paid-up equity
- Where
- India; demonstrations held across the country (article datelined Visakhapatnam)
- When
- Announced recently; AIIEA held countrywide lunch-hour demonstrations on Wednesday; SEBI compliance deadline is May 2027
- Why
- The government cites SEBI's minimum 10 per cent public shareholding requirement; AIIEA says it is a way to bridge the fiscal deficit
AIIEA View
Government of India View
LIC stake dilution
AIIEA View
AIIEA says diluting LIC's stake surrenders public ownership of India's premier financial institution to the market; LIC belongs to the people of India, not to the stock market.
Government of India View
The government says the OFS is needed to comply with SEBI's requirement of a minimum 10% public shareholding by May 2027.
Reason for disinvestment
AIIEA View
AIIEA says the government, having failed to stimulate investment, generate quality employment and augment revenues sustainably, is selling public assets to bridge its fiscal deficit.
Government of India View
The government frames the move as technical compliance with market regulations rather than piecemeal privatisation of public assets.
Key facts
- Company
- Life Insurance Corporation of India (LIC)
- Seller
- Government of India
- Offer for Sale
- Base sale 2.5% of paid-up equity plus 4% green shoe option (up to 6.5%)
- Government's justification
- SEBI requirement of minimum 10% public shareholding
- Compliance deadline
- May 2027
- Opposing union
- All India Insurance Employees' Association (AIIEA)
- Union spokesperson
- Shreekant Mishra, general secretary, AIIEA
- Protest
- Lunch-hour demonstrations on Wednesday across the country
Sources
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