The Indian Government hopes to pass a bill further opening its insurance sector to foreign investors within the next month, according to Indian media reports.

This would allow up to 49% foreign ownership of insurers, rising from a cap of 26%.

The proposal would let IAG increase its 26% stake in SBI General Insurance Company, its joint venture with the State Bank of India.

But Indian media say the minority Government may struggle to pass many of its bills in the current parliamentary session.

The plan to lift the foreign investment cap was introduced in the 2004/05 budget but has been deferred because the Government lacked the numbers to pass it.