A day after Minister of State for Finance Jayant Sinha pitched for enhancing the EPFO’s exposure to the stock markets, labour minister Bandaru Dattatreya on Friday said he would rather tread cautiously and assess the returns on such investments being made before any hikes.
“By the end of March 2016, we are putting in the market approximately Rs 5,000-6,000 crore. Depending on the result of this, we will proceed further. I hope the results will be good… (But), I have to go very cautiously,” Dattatreya, who is also the chairman of the trustees board of EPFO, told reporters.
Following a Budget announcement, the labour ministry had in April notified the new investment pattern for EPFO allowing it to invest a minimum of 5 per cent and a maximum of 15 per cent of its incremental deposits in equity or equity-related schemes. However, to start with, it decided to invest 5 per cent of the incremental deposits in exchange traded funds (ETFs) managed by SBI Mutual Fund in the current fiscal. Since August EPFO has invested over Rs 400 in ETFs.
EPFO has a subscribers’ base of over four crore and is expected to receive an incremental deposits of Rs 1 lakh crore in the current fiscal.