Lok Sabha Question No. 3526 (UNSTARRED), answered on 2022-08-08
Subject: Investment of EPFO in Share Market
Ministry: LABOUR AND EMPLOYMENT
Asked by: Sambhajirao Mane Dhairyasheel, Ravi Kishan Shukla, Sanjay Sadashivrao Mandlik, Ravindra Kushawaha, Bidyut Baran Mahato, Shrirang Appa Barne, Sudheer Gupta, Manoj Kumar Tiwari, Prataprao  Jadhav, Subrata Pathak

## MINISTRY OF LABOUR AND EMPLOYMENT

## GOVERNMENT OF INDIA LOK SABHA

UNSTARRED QUESTION NO. 3526

TO BE ANSWERED ON 08.08.2022

## INVESTMENT OF EPFO IN SHARE MARKET

3526. SHRI DHAIRYASHEEL SAMBHAJIRAO MANE:

SHRI RAVI KISHAN:

SHRI SANJAY SADASHIVRAO MANDLIK:

SHRI RAVINDRA KUSHWAHA:

SHRI BIDYUT BARAN MAHATO:

SHRI SHRIRANG APPA BARNE:

SHRI SUDHEER GUPTA:

SHRI MANOJ TIWARI:

SHRI PRATAPRAO JADHAV:

SHRI SUBRAT PATHAK:

Will  the  Minister  of  LABOUR  AND  EMPLOYMENT  be  pleased  to state:

- (a)whether Employees' Provident Fund Organization (EPFO) has taken a decision to invest a portion of its annual deposits in share market and related products;
- (b)if  so,  the  total  amount  invested  in  Share  market  and  related products  by  EPFO  during  each  of  the  last  three  years  and  the current year;
- (c)the details of total profits/loss so far in the said investment;
- (d)whether the Government has taken adequate precautions to secure the interests of the pensioners due to volatile stock market where there is no guarantee of return of investment and if so, the details thereof; and
- (e)the  steps  taken/being  taken  by  the  Government  to  increase  the investment limit in Share market and related products?

## ANSWER

## MINISTER OF STATE FOR LABOUR AND EMPLOYMENT (SHRI RAMESWAR TELI)

(a) & (b): Employees' Provident Fund Organisation (EPFO) invests 85 per  cent  of  the  Funds  in  Debt  instruments  and  15  per  cent  of  the investment is made in Exchange Traded Funds (ETFs), as per the

Investment  Pattern  notified  by  the  Government.  The  investment  in ETFs  is  made  based  on  Nifty  50,  Sensex,  Central  Public  Sector Enterprises  (CPSEs)  and  Bharat  22  Indices.  The  details  of  equity investment for the last three years and the current year are as under:

(Rs. In crore)

| Financial Year            | Amount invested in ETF Total amount (Debt & Equity) invested   | Amount invested in ETF Total amount (Debt & Equity) invested   |
|---------------------------|----------------------------------------------------------------|----------------------------------------------------------------|
| 2019-20                   |                                                                | 2,20,236.47                                                    |
| 2020-21                   |                                                                | 2,18,533.89                                                    |
| 2021-22                   |                                                                | 2,89,930.79                                                    |
| 2022-23 (upto June, 2022) |                                                                | 84,477.67                                                      |

## (c): The details of cost price of investment in ETF till 31.03.2022 and Notional Market Value [as per Net Asset Value (NAV)] on 31.03.2022 is as under:

| (Rs. in crore)                                                                              | (Rs. in crore)   |
|---------------------------------------------------------------------------------------------|------------------|
| Cost price of amount investment in ETF as on 31.03.2022 Notional Market NAV on 31.03.2022 ) | value (as per    |
| 1,59,299.46                                                                                 | 2,26,919.18      |

(d): Yes,  Sir.  The  details  of  due  measures  of  diligence  are  in place, as under:

1. All  investments  are  done  as  per  the  Pattern  of  Investment notified by the Government.
2. Investment  Guidelines  are  approved  by  the  Central  Board  of Trustees' (CBT), tripartite governing body of EPFO.
3. The  investment  is  made  through  Portfolio  Managers  and  ETF Manufacturers appointed by CBT, EPFO for such purpose.
4. The  Financial  Consultant  of  EPFO  and  the  External  Concurrent Auditor  monitor all the investments  made  by  the  Portfolio Managers  and  ETF  Manufacturers  to confirm  that  they  are  in accordance  with  the  Pattern  of  Investment  notified  by  the Government and the Investment Guidelines approved by the CBT, EPFO from time to time.
5. The  CBT  has  appointed  a  Custodian  for  Securities,  to  maintain account and record of all the instruments.
6. The  CBT  and  its  sub-committee  monitor  all  investment  related aspects periodically.
7. (e): No such proposal is under consideration of the Government.

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