By Priyanka Saurabh Across the country, we hear the incidents of death and torture of those detained by the police. The result of which the image of the police is stained. Not only this, but the cruelty of police is also born in people of criminal tendencies. The encounters with the policemen and the martyrdom […]
New Delhi, Dec 8 (IANS) The passing of the pensions regulator act will spur growth of the investment corpus in the pensions sector to over $1 trillion by 2025, says a report jointly prepared by the Confederation of Indian Industry and global professional services firm Ernst & Young (EY).
“Investment corpus in the Indian pensions sector is estimated to reach greater than $1 trillion by 2025 as the sector moves forward to realize its full growth potential after the passage of the Pension Fund Regulatory and Development Authority (PFRDA) Act 2013, according to the CII-EY Report on Pensions Business in India,” CII said in a release here Sunday.
The report said the pensions business presents an attractive opportunity because of India’s changing demographics, an inadequate government-funded pensions system and the presence of a vibrant insurance and funds management sector.
“In line with India’s demographic transition, the need for protecting old-age income security would underpin the growth of pensions market in India as the focus sharpens on expanding the coverage of National Pension System (NPS) in the private sector and the insurance companies, even as mutual funds assume greater role in the Indian pensions market”, said Chandrajit Banerjee, director general, CII.
Pensions systems globally are key drivers of the infrastructure sector, providing stability in capital markets, the report said,
The government has set an investment target of $1 trillion for the infrastructure sector for the 12th Plan (2012-16) period, while it expects the private sector to contribute 45 percent of the targeted funding.
According to the report, private pension funds are likely to contribute 24 percent of the total corpus by 2025, while pensions and annuity products offered by life insurance companies are likely to account for around 16 percent.
The existing retirement funds corpus is in range of Rs.12-15 trillion, of which the Employees Provident Fund (EPF) makes up one-third of the total, while the Public Provident Fund (PPF) and NPS account for about 2.5 percent each.
The report said that by 2030, 180 million Indians or 12 percent of the population will be in the age bracket of 60-plus.