Indian retirement fund given green light to sink $3.5bn into ETFs
Indian retirement fund the Employees’ Provident Fund Organisation (EPFO) has been granted approval by its central board of trustees to plough INR22,500 crore ($3.5bn) into exchange traded funds (ETFs) over the coming months. The decision followed a recommendation to raise the equity investment limit from 10% to 15%. Since it began investing in ETFs in 2015, the EPFO's cumulative return on the investment has been more than 13%.

NEW DELHI: Retirement fund body the Employees’ Provident Fund Organisation plans to pump in Rs 22,500 crore in exchange traded funds in 2017-18 following the go-ahead from the central board of trustees of EPFO to increase the equity investment from 10% to 15%.“The investment limit in ETFs has been recommended to be raised from 10% to 15% by the Central Board of Trustees, Employees Provident Fund in its 218th meeting held in May. Accordingly the estimated investment in ETF for the current financial year is approximately Rs 22,500 crore,” labour minister Bandaru Dattatreya said in a written reply in Rajya Sabha on Wednesday.According to the minister, the EPFO has invested Rs 6577 crore in ETFs in 2015-16 and Rs 14984 crore in 2016-17. According to EPFO, the cumulative return on investment has been over 13% since it started investing in ETFs in August 2015 with initial investment of 5% of its investible deposits of around Rs one lakh crore.In 2016-17, the proportion of these investments was raised to 10% which would further be raised to 15% for the current fiscal.