LIC IPO: How Is it the Biggest Privatisation Scam in India?
In February 2022, the Union Government filed its Draft Red Herring Prospectus [DRHP] with the Securities and Exchange Board of India [SEBI] and took the formal step toward disinvesting a part of its stake in the Life Insurance Corporation of India [LIC] through an Initial Public Offering [IPO]. The terms of the IPO, especially the manner in which the offer has been priced, have set off allegations that this is the biggest ever scam in the history of privatisation in India. The privatisation of India’s biggest insurance provider, also among the biggest in the world, would result in substantial losses to not just LIC’s policyholders but the government.
V Sridhar, a senior journalist, is a member of the People’s Commission on Public Sector and Public Services, which was constituted in the background of the government’s renewed push towards privatisation in the midst of the COVID-related crisis. Sridhar has written extensively on the LIC IPO, proving it to be a major scandal in the realm of privatisation in India. His insight provides not only a unique perspective on the rights of LIC policyholders but what the privatisation of this unique institution implies for the spread of the culture of life insurance in India.
Sridhar spoke with The Leaflet on the basics of LIC’s nature of operations, and the implications of its IPO.
Edited excerpts from the interview:
Q: Can you tell us how LIC, being one of the biggest insurance operators in the Indian market, is…