Tata AIG introduces insurance bonds to aid contractors

28 May 2024 CW Team

Tata AIG General Insurance has rolled out surety insurance bonds to bolster the Indian government's endeavours in infrastructure development. These bonds serve as an alternative to conventional bank guarantees, facilitating contractors' more efficient participation in the sector. With the government allotting 3.3% of the GDP for the fiscal year 2024 towards infrastructure, there's substantial potential for insurance firms providing surety bonds.

The introduction of these bonds aims to assist contractors in unlocking capital, augmenting their bidding capabilities, and overcoming liquidity and capital constraints. Deepak Kumar, Senior EVP, Tata AIG General Insurance affirmed the company's commitment to addressing the pressing liquidity and capital issues prevalent in the infrastructure domain. He expressed confidence that this product would not only streamline project execution but also contribute to India's ambition of achieving a $5 trillion economy.

Surety bonds safeguard project owners from losses arising due to contractor non-performance, failure to fulfil obligations, or breach of contract terms. Tata AIG's product portfolio encompasses various types of contract bonds, including bid bonds, performance bonds, advance payment bonds, and retention money bonds, all in compliance with IRDAI guidelines. These bonds ensure that the principal party fulfils its contractual duties to the obligee. In case of default by the principal, the surety company compensates the obligee for incurred losses.

During the presentation of the Union Budget 2022-23, Finance Minister Nirmala Sitharaman announced plans to recognise surety bonds as substitutes for bank guarantees in government procurement. However, insurers note that the market uptake has been limited due to their exclusion from certain rights enjoyed by other financial creditors in bankruptcy proceedings. (Source: ET)

Infrastructure Energy

14 Oct 2025

Mizoram To Build Rs 139 Billion Pumped Storage Power Plant

Mizoram Chief Minister Lalduhoma on Friday announced plans to construct a 2,400 MW pumped storage hydroelectric power plant in Hnahthial district, marking a major step towards achieving energy self-sufficiency in the state. Addressing the Mizo Students’ Union general conference in Hnahthial town, the Chief Minister said the plant would be developed across the Darzo Nallah, a tributary of the Tuipui river. Once operational, the project is expected to play a pivotal role in meeting Mizoram’s rising electricity demand and reducing dependence on imported power. Officials from the State Power..

Centre Plans Nationwide Opening Of Power Retail Market

India is preparing to open up its retail electricity market to private companies nationwide, effectively ending the long-standing monopoly of state-run power distributors in most regions, according to a draft bill released by the Union Power Ministry on Friday. The move will enable major private sector players — including Adani Enterprises, Tata Power, Torrent Power, and CESC — to expand their presence across the country’s electricity distribution landscape. A similar reform attempt in 2022 had faced strong opposition from state-run distribution companies (discoms), which currently dom..

CEA Sets 100 GW Nuclear Target For India By 2047

In a landmark step marking its 52nd Foundation Day, the Central Electricity Authority (CEA) unveiled an ambitious roadmap to develop 100 gigawatts (GW) of nuclear power capacity by 2047, aligning with India’s long-term Net-Zero commitment and energy security objectives. The event, held at the Central Water Commission auditorium in New Delhi’s R.K. Puram, was attended by Pankaj Agarwal, Secretary, Ministry of Power, who served as the Chief Guest. The roadmap sets out a detailed plan to expand India’s nuclear capacity from its current level of approximately 8,180 MW as of early 2025, outl..