Rajiv Kumar, Vice-Chairman, Niti Aayog, on Tuesday, backed the decision to allow the Life Insurance Corporation of India (LIC) to pick up a majority stake in debt-ridden IDBI Bank and said that the state-owned insurance firm would eventually benefit from the move.

“I am betting on LIC making very good money having invested in IDBI Bank, now that they have changed the management. I know the person who has been given the task. He is one of our best bankers and best professionals. The bank will be turned around and its market cap will increase over some years. LIC will be able to get good returns on its investment,” Kumar said while addressing the media at an event to mark the achievements of the policy think-tank in the last four years.

On Friday, the Insurance Regulatory and Development Authority gave the green signal to LIC to increase its equity in IDBI Bank to 51 per cent from the existing 10.8 per cent.

On the recent fall in the rupee, he said, “It’s not a worrying factor as there has been no free-fall.” According to him, the rupee, which breached 69 against the US dollar for the first time, is still relatively over-valued. “So, there is no reason to be nervous,” he said.

Amitabh Kant, Niti Aayog CEO, who was also present at the event, said the government has accepted the think-tank’s recommendations on disinvestment of central public sector enterprises (CPSEs) and that the disinvestment process in 12 state-owned firms is in advanced stages.

“We must allow the process to occur transparently and comprehensively,” he said.

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