The total size of pension market in India is estimated to have stood at over Rs 1.5 lakh crore (Rs 1.5 trillion) in 2010, while it is expected to rise to over Rs 2 lakh crore (Rs 2 trillion) by 2015 and further to close to Rs 3 lakh crore (Rs 3 trillion) in 2020 and more than Rs 4 lakh crore (Rs 4 trillion) by 2025.
This includes individual retirement money, provident fund and other small savings and is based on a study conducted by a government-appointed expert panel.
However, the share of this vast capital pool is almost negligible in the equity markets, although a lot of foreign pension funds including from the US and Canada regularly invest in Indian markets.
Talking about steps required to attract pension money to markets, Sebi Chairman U K Sinha said a favourable taxation framework is crucial for achieving this goal.
"There are two angles here, one is that Employee Provident Fund Organisation money is not coming to the market and the trustees of the EPFO have refused to invest 15 per cent into equities which Finance Ministry has also allowed.
"That is something beyond Sebi's scope of working," Sinha told PTI in an interview.
"The second issue is if others (fund houses)
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