Will LIC Stand Firm Or Will It Bend Against External Influence?

There is growing noise around LIC’s investments, with some groups targeting it along with groups like Adani and Reliance, calling them “risky.” This is an attempt to influence LIC’s decisions through media and social media pressure.Between 2010 and 2013, similar campaigns targeting India’s coal, energy and power and defence sectors led to a policy paralysis resulting in economic failures and large NPAs in public sector banks. Stocks like Coal India, NTPC, ONGC, BHEL, and Hindustan Aeronautics faced stalled decisions due to external pressure.If LIC hesitates due to public pressure or selective criticism, it could delay vital long-term investments in India’s infrastructure and capital markets, harming the country’s financial stability.Its important that LIC remains firm on its stands so it protects policyholders’ money and supports India’s long-term growth.Facts:LIC is not just another company. It is India’s largest financial institution, managing Rs 55 lakh crore of the nation’s savings. Almost every Indian family has some connection with LIC. That is why any attack on LIC’s credibility does not just affect LIC — it affects India’s trust in its own institutions.Some organised groups are spreading selective information, but they do not tell you that private institutions like SBI Life, HDFC Life, HDFC, ICICI, Kotak, and many mutual funds hold similar or sometimes larger exposures in the same companies. Singling out only LIC creates confusion and unnecessary fear.LIC follows strict rules — no special treatment for anyoneLIC cannot invest more than 1% of its total fund in any corporate group.Every investment has to go through:Detailed checks,IRDAI regulations,Board approvals.Reliance on Proxy AdvisorsNo single officer or politician can decide where LIC invests.LIC’s money is spread across the entire economyLIC has investments in 300+ top Indian companies — Adani, Reliance, Tata, Aditya Birla and many more.It does not depend on any one group or one sector.In fact, LIC’s investments have multiplied because of this disciplined approach.Its equity portfolio grew from Rs 1.5 lakh crore in 2014 to Rs 15.5 lakh crore today — a 10x increase.Most of the remaining fund — about Rs 40 lakh crore — is in AAA-rated government debt and in ‘AAA’ rated assets from other companies such as Adanis, Tatas and Reliance--the safest category of investment.But why is LIC being targeted now?A lot of the criticism focuses on LIC’s investment in one or two particular groups such as Adani and Reliance. But look at the facts:Since 2017, LIC invested about Rs 31,000 crore in Adani group.Today, the value is around Rs 65,000 crore.That is not a loss — that is a gain because of proper due diligence.In debt, LIC invested Rs 5,000 crore ‘AAA’ rated bonds from Adani which drew so much attention. Meanwhile, similar or larger investments in the same group have been made since LIC’s investment by US insurers like Athene Life, MetLife ($750 million/Rs 6,700 crore) and by Indian institutions like HDFC Bank (Rs 10,000 crore+), Japan’s largest banks such as MUFG and Mizuho, and some of Europe’s largest Banks such as DZ World (Germany’s largest bank, BNP Paribas, Barclays and Standard Chartered. Blackrock, world’s largest fund has also invested in Adani Group in May 2025.But no one questions them.This selective criticism creates doubt, not clarity. It can lead to decision paralysis, similar to what India faced between 2010 and 2013, when confusion around coal, power and defence halted projects and slowed the economy.Why LIC invests in companies like Adani and Reliance that own infrastructure?To understand this, think simply:If you want stability, you invest in something that gives steady income every year.Infrastructure — power lines, airports, ports, energy distribution, and logistics — gives exactly that.It is predictable and steady, like rent from a house or income from a shop.This is not an Indian idea — this is a global insurance model.Look at Warren Buffett’s company, Berkshire HathawayMany people admire Warren Buffett. His company controls major infrastructure assets in the North America (US and Canada):Electric generation power plants (Coal, natural gas and hydro)Transmission and distribution assets in North America (US and Canada) and UkSolar and wind plantsNatural Gas storage facilities and pipelinesLargest railroads and rail maintenance companies in North AmericaSome of the companies it owns includes Mid American Energy Cmopany, PacifiCorp, NV Energy, Northern Powergrid, BHE Pipeline Group, BHE Renewables, BNSF Railway, Altalinks etc.Berkshire generates near 20% of profits only from infrastructure sector. Interestingly, these are the very infrastructure areas where India’s largest infra player Adani operates with assets that are rated ‘AAA’ or safest by any standards by all rating agencies. Despite that anti-India forces want LIC to not invest in companies like Adani and Reliance.A Rs 5,000 crore (0.1% of LIC’s total AUM) recent investment(May 2025) by LIC in Adani created so much noise, while US insurance companies such as Meta Life, Athene Life invested Rs 6,700 crore (USD 750 Mn) invested more than that (In June 2025).India has only a few groups that operate such large, national-scale infrastructure.Groups like Adani, Reliance, and Tata run:Transmission lines, Renewable Energy, Energy networks, Ports, Logistics Chains, Roads, AirportsThese assets usually have AAA or high safety ratings from rating agencies.For an insurer like LIC — which needs to think 20, 30, even 40 years ahead — such companies offer stability, security, and steady income.This is exactly why global insurers invest heavily in infrastructure.LIC is doing the same — following the same global best practices. A growing attempt to destabilise the Indian economy by creating systemic risk in the insurance sector.In contrast to large global insurers, many Indian insurers, not just LIC, but SBI Life, and ICICI Prudential, have significant exposure to the IT and banking sectors—industries highly vulnerable to technological disruption and geopolitical shocks.Recent events, such as the US USD 100,000 visa rule, sent immediate tremors through India’s IT sector. Looking ahead, innovations like AI could replace large portions of IT services, affecting companies like TCS, Infosys, and Wipro.The critical question is: if a major natural disaster, pandemic, or economic shock occurs in 2040, will insurers heavily exposed to volatile sectors be able to meet their obligations and pay claims? This underscores the strategic importance of long-term, stable infrastructure investments, which safeguard both policyholders and the broader economy.So the question is not “Why LIC invested here?” The real question is “Why should LIC not invest here, when every global insurer does?”LIC has always protected policyholders — since 1956Even during earlier periods when LIC had exposure to troubled companies, LIC never defaulted or failed its customers. LIC under the UPA government took a big hit on investments as it made big investments in Mallya companies, DLF, GVK, Gitanjali Gems, Vakrangee etc—but no such cases in the past ten years.Since 2014, there has not been a single major investment failure of the kind seen earlier.As mentioned previously LIC’s equity portfolio has 10-folded from Rs 1.5 lakh crore to Rs 15.5 lakh crore. Investments in companies such as Adani, Tatas and Reliance is a major reason..Disclaimer: NDTV Profit is a subsidiary of AMG Media Networks Limited, an Adani Group Company..

Will LIC Stand Firm Or Will It Bend Against External Influence?

Between 2010 and 2013, similar campaigns targeting India’s coal, energy and power and defence sectors led to a policy paralysis

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Between 2010 and 2013, similar campaigns targeting India’s coal, energy and power and defence sectors led to a policy paralysis

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