Mr. Rakesh Jain on Budget 2022 – Hindu Business Line

Published By: Business Line ​

Published Date: NA

The article highlights the introduction of surety bonds as part of the Union Budget 2022 announcements, emphasising their potential to transform the financial landscape for infrastructure projects. According to Finance Minister Nirmala Sitharaman, surety bonds issued by insurers will serve as a substitute for bank guarantees in government procurements.

Rakesh Jain, CEO of Reliance General Insurance, noted that this move recognises the insurance industry's ability to provide alternative financial solutions, creating ways to reduce costs and diversify risks. Industry experts, such as Joydeep K Roy, observe that the adoption of surety bonds will attract foreign capital. He also believes that it will create new revenue streams for insurers while also promoting competition with banks.

However, banking experts like V Viswanathan caution that insurers may face challenges when evaluating credit risks compared to banks. Despite these challenges, the initiative is expected to enhance financial inclusivity and support large-scale infrastructure development in India.