The Department of Investment and Public Asset Management (DIPAM) will start developing the index for the ETF based on investors' feedback about demand of sector specific stocks.
"We are eyeing large overseas pension funds for investments into the overseas ETF. We will soon appoint fund managers for developing the new ETF. Global roadshows have seen good investor interest in ETF route for investments into CPSEs," the official said.
The government currently has two exchange-traded funds -- CPSE ETF and Bharat-22 ETF -- listed on domestic exchanges. ETFs function like a mutual fund scheme and have underlying assets of government-owned companies.
Bharat-22 ETF, which was launched in 2017-18, has 16 central public sector enterprises covering six sectors, 3 public sector banks and 3 private sector companies where the government holds minority stake.
The government has already raised Rs 32,900 crore through two tranches and an additional fund offer of Bharat-22 ETF, and Rs 38,000 crore in five tranches of CPSE ETF in the domestic market.
The government has budgeted to collect Rs 90,000 crore through CPSE disinvestment in the current fiscal as against Rs 85,000 crore mopped up in 2018-19.
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