New Delhi: Assocham on Sunday urged the trustees of the Employee's Provident Fund Organisation to favourably consider the Finance Ministry's recommendation to allow EPFO to invest about 5 percent of its corpus in capital markets.
"The time has now come for the Central Board of Trustees (CBT) under the ministry of Labour to honour the recommendation of the Finance Ministry for nearly 5 percent EPFO fund channelisation in indices-based investment strategy in equities," Assocham president Sajjan Jindal said.
Employees Provident Fund Organisation (EPFO), which has a large corpus of about Rs 2.60 lakh crore has been paying 8 percent interest to its subscribers, partly from its reserves and hardly earning reasonable returns on its investments in government securities and bonds to sustain its operations effectively and profitably for future, it said.
It said since the RBI and SEBI jointly keep strong watch on stock market fluctuations, it is highly unlikely that investors especially like EPFO could loose money in indices linked equities.
"This argument can convincingly address apprehensions of trade union leaders who are opposing part of EPFO investment towards equity-based indices as days have gone in which stock market fluctuations could erode investment prospects of investors," it added.
Bureau Report
First Published: Sunday, October 04, 2009, 11:29