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| EPFO committee rejects plans to park 15% funds in stock market |
| BS Reporter / New Delhi Mar 27, 2009, 00:52 IST |
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An advisory committee of the Employees’ Provident Fund Organisation (EPFO) today rejected a finance ministry proposal to invest up to 15 per cent of its funds totaling around Rs 1,82,000 crore in the stock markets.
The proposal, made in August last year, was to park this corpus amount in publically-listed companies and mutual funds for higher returns. The rejection came in the wake of continuing volatility in the stock markets, it is learnt. At present, no equity investment is permitted.
If accepted, the EPFO would have been one step closer to park up to 15 per cent of its funds in the companies listed on the Bombay Stock Exchange and National Stock Exchange and also the equity-linked schemes of Securities and Exchange Board of India (Sebi)-regulated Mutual Funds.
The recommendations of the finance and investment committee, which rejected the finance ministry proposal today, are usually accepted by the EPFO’s Central Board of Trustees, which is headed by the labour minister, who has the final say on such matters.
At present, EPFO funds are parked in secure financial instruments like central government securities, state government loans and government guaranteed securities.
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