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UTI plans restructuring of its six offshore funds

Janaki Krishnan & Rakesh P Sharma

The Unit Trust of India is in the process of restructuring its offshore funds.

The corpus of the six offshore schemes which was valued at $1 billion in March 2000 has since eroded to $170 million as of May 31, 2002.

The asset managers of India Infrastructure Fund, which has a commitment of $50 million, is planning to approach multilateral funding agencies to increase the corpus further.

UTI executive director D S R Murthy said that it was still in the planning stages. So far, the fund has committed $37.5 million in various projects.

The trust is also planning a couple or more of offshore funds -- "speciality funds" -- Murthy said. The objective is to mobilise resources. The plan is expected to be finalised internally within a month.

Murthy said that the September 11 event last year and the general economic slowdown worldwide have impacted the "money flow into the offshore funds". He pointed out that the aim was to lower repurchases from these schemes.

The trust -- which has undertaken activities on a turnkey basis in Sri Lanka and Egypt -- is planning a similar arrangement in Bangladesh. Murthy said that UTI got the approval of Bangladesh government last week.

The UTI management is also planning to transform India Access Fund -- an index fund tracking the National Stock Exchange's Nifty index -- into an exchange-traded fund. Buyback is also going on at India Fund, a close-ended fund listed on the London and Dublin stock exchanges.

According to Murthy, the UTI board has been kept informed of the various developments in the offshore funds.

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