The Government of India may raise FDI in the pension sector from 49% to 100%. A legislative amendment is expected in the upcoming Monsoon Session.
If approved, this move would match the pension sector with insurance, where the FDI cap was recently raised to 100%. (
The proposed amendment to the Pension Fund Regulatory and Development Authority (PFRDA) Act, 2013, is aimed at attracting greater foreign capital, enhancing competition, and strengthening the long-term growth prospects of India’s pension ecosystem.
In addition to raising the FDI limit, the government is exploring structural reforms, including separating the National Pension System (NPS) Trust from PFRDA. This move is intended to establish a more independent and transparent governance framework, with the Trust potentially operating under a separate legal structure and overseen by a professional board.
Industry observers say the reform could boost investor confidence and global expertise. It may also intensify competition for domestic fund managers.
The National Pension System replaced traditional pension schemes for government employees in 2004 and was expanded to the public in 2009.
The proposed FDI increase shows the government’s push for financial reforms and aims to deepen markets, strengthen savings, and improve retirement frameworks.
Image Source: ANI
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