New Delhi, Jun 30 (IANS): CPI-M leader Sitaram Yechury on Saturday targeted the Narendra Modi government over the approval given by the IRDAI to LICs plan to buy 51 per cent stake in debt-ridden IDBI Bank and alleged that it was "destroying regulatory mechanism and practising cronyism of the worst kind".

The Communist Party of India-Marxist leader said LIC's money is public money and accused the government of bailing out rich defaulters by diverting people's money.

"Bailing out rich defaulters, by diverting peoples' money. LIC is public money. Why no recovery of loans from rich defaulters? Cronyism of the worst kind by this Modi government. Rich can loot and scoot, the common Indian will pay back their loans," Yechury tweeted.

"LIC is not supposed to be in banking. It is being forced by suddenly changing rules. Regulatory mechanism being destroyed by Modi government so that defaulters don't have to repay. What is going on?" he added.

The media reported on Saturday that the Insurance Regulatory and Development Authority of India (IRDAI) had approved the plan of Life Insurance Corportation of India to buy 51 per cent stake in the state-owned IDBI.

Congress leader Kapil Sibal also raised questions over the IRDAI move and slammed the government over its management of economy.

"Rupee all time low, IDBI bail out by LIC for unmanagable NPAs and deposits by Indians in secret Swiss bank accounts rise by 50 per cent in 2017. Who is in ICU Modiji: Economy or NDA or Achhe Din?" he said.