India Clears Major Reforms to Open Nuclear and Insurance Sectors to Foreign Investment

India’s cabinet has approved significant policy reforms to liberalise the nuclear energy and insurance sectors, aiming to attract large-scale foreign investment and accelerate long-term economic and climate goals. The changes, cleared ahead of the ongoing winter session of Parliament, involve amendments to atomic energy laws and a proposal to fully open the insurance sector to foreign investors, according to government sources. In the nuclear sector, the government plans to relax decades-old restrictions that established a state monopoly, enabling greater private and foreign participation. These reforms are intended to address stringent liability provisions that have long discouraged overseas technology suppliers. The move aligns with India’s strategy to sharply scale up nuclear power capacity to 100 gigawatts by 2047, supporting efforts to reduce reliance on coal and meet its climate commitments. For the insurance sector, the cabinet has approved a proposal to remove the existing cap of 74% on foreign ownership of Indian insurance companies, effectively allowing 100% foreign direct investment. However, to qualify for full foreign ownership, companies will be required to appoint at least one Indian resident as chairperson, managing director, or chief executive, ensuring continued domestic oversight. At the same time, the government has decided to drop an earlier proposal to introduce a unified licence for insurance companies. Such a licence would have allowed insurers to offer life, general, and health insurance under a single entity. Officials said the decision reflects concerns that Indian insurers are not yet ready for a composite licensing regime, and that the current structure—separating life and general insurance operations—will remain in place for now.