Warning: call_user_func_array() [function.call-user-func-array]: First argument is expected to be a valid callback, '' was given in /home/content/50/8762750/html/wp-includes/class-wp-hook.php on line 298

INDIAN PENSIONS

INDIAN PENSIONS

According to Bloomberg news, Indian trade Unions and the Marxist parties in the country have long resisted a plan to allow government employees a chance to have their own individual 401k’s, or to invest personally in mutual funds or stocks for their retirement.  Rather, the unions are fixed on maintaining defined benefit plans which will guarantee 1/2 of full salary for retired government workers.

However, in the next few months, a new plan for all government workers who joined after January 2004 will be instituted.  Their retirement funds will be handed over to three asset management companies.  "The managers will be able to invest five percent of the money in equities and 10% in equity linked mutual funds."  Much of this will flow into the Indian stock and bond markets and as time passes, these pension assets could easily help form the backbone of a rising stock market in India.  Andy Mukerjee of Bloomberg wrote on April 17, 2007, "Assuming that India’s $822 billion economy grows 8% a year (the current growth rate) with 5% inflation,  a $5 trillion stock market should be within India’s reach in slightly more that a decade; as much as a fifth of it may be associated with larger flows of retirement funds into equities."

Many global stock markets have benefited from a consistent and growing inflow of pension assets over the last several decades.  Most of the world’s large economies have benefited from this trend.  Now it looks like India’s turn.

These articles are for informational purposes only and are not intended to be a solicitation, offering or recommendation of any security.  Guild Investment Management does not represent that the securities, products, or services discussed in this web site are suitable or appropriate for all investors.   Any market analysis constitutes an opinion that may not be correct.  Readers must make their own independent investment decisions.
The information in this article is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation, or which would subject Guild Investment Management to any registration requirement within such jurisdiction or country.
Any opinions expressed herein, are subject to change without notice.  In addition, there are many market, currency, economic, political, business, technological and other risks that are beyond our control.  We make reasonable efforts to provide accurate content in these articles; however, some content and some of the assumptions, formulas, algorithms and other data that impact the content may be inaccurate, outdated, or otherwise inappropriate.  In addition, we may have conflicts of interest with respect to any investments mentioned.  Our principals and our clients may hold positions in investments mentioned on the site or we may take positions contrary to investments mentioned.
Guild’s current and past market commentaries are protected by copyright.  Apart from any use permitted under the Copyright Act, you must not copy, frame, modify, transmit or distribute the market commentaries, without seeking the prior consent of Guild.