Decision on raising equity investment by EPFO deferred, remains at 5% for now

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Published: July 8, 2016 5:33:58 PM

The Central Board of Trustees (CBT) of the Employees' Provident Fund Organisation (EPFO) has deferred taking a decision on increasing the limit of investment in equities through exchange traded funds (ETFs).

Decision on hiking equity investment by EPFO deferred, remains at 5% for nowThe Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO) has deferred taking a decision on increasing the limit of investment in equities through exchange traded funds (ETFs). (Photo: PTI)

The Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO) has deferred taking a decision on increasing the limit of investment in equities through exchange traded funds (ETFs).

Sources told FeMoney that Labour Minister Bandaru Dattatreya has assured CBT that the matter will be discussed at the next meeting. The move to raise ETF investment limit did not figure in the 19-point agenda of the meeting.

Central labour unions expressed their displeasure at the meet that the government has been issuing statements on the issue without the matter being discussed at the CBT.

“The minister has assured us that the issue would be discussed at a subsequent meeting after it forms part of the formal agenda,” a CBT source said.

At present, EPFO has CBT approval for equity investment up to 5 per cent of the corpus that it manages. However, the investment guidelines laid down by the government allows this limit to be raised to 15 per cent.

According to government figures, as on March 31, 2016, EPFO’s investment in ETF stood at Rs 6,577 crore which grew to Rs 6,601 crore, a 0.37 per cent increase. On April 30, 2016, the amount invested was Rs 6,674 crore which grew to Rs 6,786 crore, up 1.68 per cent.

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