Updated 16:46 IST, February 1st 2025
Union Budget 2025: 'First Develop India', FDI For Insurance Jumps To 100 % And More- See Details
By raising FDI limits, simplifying KYC, and improving investment frameworks, these measures will help strengthen India's financial ecosystem.

Finance Minister Nirmala Sitharaman, while presenting the Union Budget 2025-26, announced key reforms in the financial sector aimed at boosting growth, investment, and global competitiveness over the next five years. These reforms cover critical areas like insurance, pensions, foreign investments, company mergers, and KYC simplifications.
Smt. Nirmala Sitharaman said that the FDI limit for the insurance sector will be raised from 74 to 100 per cent. This enhanced limit will be available for those companies which invest the entire premium in India.
FDI in Insurance Sector Increased to 100%
In a major push to attract foreign investment, the government has raised the Foreign Direct Investment (FDI) limit in the insurance sector from 74% to 100%. However, this increased limit is only applicable to companies that invest the entire premium within India. Additionally, the existing conditions on foreign investment will be simplified to encourage more participation from global insurers.
Pension Sector: Regulations & Development
To improve coordination and growth in the pension sector, the government will set up a regulatory forum that will focus on the development of pension products. This move aims to expand retirement savings options and attract more investments in pension funds.
Simplifying KYC with a Centralized System
The government is taking steps to simplify the Know Your Customer (KYC) process. A revamped Central KYC Registry will be launched in 2025, making it easier for individuals and businesses to comply with KYC norms. A streamlined system for periodic updates will also be introduced, reducing compliance burdens for financial institutions.
Faster & Easier Company Mergers
To promote business growth and ease of doing business, the government will simplify the approval process for company mergers. The scope for fast-track mergers will be expanded, making it easier and quicker for companies to restructure and consolidate.
Revamping Bilateral Investment Treaties (BITs)
In a bid to attract long-term foreign investments, the government will revise its Bilateral Investment Treaty (BIT) framework. The new model will be more investor-friendly, while aligning with the country’s economic interests under the vision of ‘First Develop India’.
The Union Budget 2025 lays a strong foundation for financial sector reforms, focusing on enhancing foreign investments, streamlining regulations, and boosting ease of doing business.
By raising FDI limits, simplifying KYC, and improving investment frameworks, these measures will help strengthen India's financial ecosystem and global competitiveness.
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Published 16:46 IST, February 1st 2025