English Typing
Paragraph
The
Insurance
Regulatory
and
Development
Authority
of
India
has
approved
a
proposal
to
allow
the
Life
Insurance
Corporation
of
India
to
increase
its
stake
in
the
ailing
state-owned
IDBI
Bank
to
51%.
The
plan
envisages
the
insurer
injecting
much-
needed
capital
into
the
financially
stressed
lender,
which
was
placed
under
the
Reserve
Bank
of
India's
prompt
corrective
action
framework
in
May
2017
as
a
consequence
of
its
non-performing
assets
rising
beyond
a
threshold.
While
there
are
no
details
on
how
exactly
this
capital
infusion
will
take
place
reports
suggesting
that
the
LIC
may
acquire
the
additional
40%
stake
it
would
need
to
reach
51%
shareholding
from
the
Government
of
India
market
speculation
and
media
reports
have
estimated
figures
north
of
?10,000
crore.
While
for
the
LIC
the
sum
is
a
small
fraction
of
the
?1.24
lakh
crore
it
received
in
just
first-year
premiums
in
the
year
ended
March
31,
2017,
for
IDBI
Bank
the
funds
would
almost
equal
the
?12,865
crore
in
capital
infusion
it
got
from
the
government
in
the
last
fiscal.
Whether
this
will
be
adequate
to
even
staunch
the
flow
of
red
ink
at
the
troubled
bank,
leave
alone
help
it
turn
around,
is
another
matter.
The
bank
posted
a
net
loss
of
?8,238
crore
in
the
12
months
ended
March
31,
2018,
and
is
facing
the
prospect
of
more
losses
with
gross
non-performing
assets
rising
to
28%.
The
proposal
raises
several
troubling
questions.
The
government
clearly
sees
it
as
a
relatively
painless
way
to
recapitalise
the
bleeding
bank
without
adversely
impacting
its
fiscal
position,
but
the
risks
in
increasingly
banking
on
state-controlled
cash-rich
corporations
to
help
bail
out
other
state-owned
companies
or
lenders
are
too
significant
to
be
glossed
over.
Then,
there
are
the
regulators.
The
IRDA,
whose
mission
is
to
"protect
the
interest
of
and
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