Pensioners can invest in Fixed income instruments and equity

Government said on Tuesday subscribers under the New Pension System will have a choice to invest in fixed income instruments and equity.

"It is envisaged that, under the New Pension System, subscribers will have a choice of multiple investment options with varying proportions of investment in fixed income instruments and equity," Finance Minister P Chidambaram said in a written reply to a question in Rajya Sabha.

Investment guidelines would be framed by the regulator.

"However, until the full NPS architecture is in place, in the interim, contributions under NPS are credited into the public account," he said.

Under the NPS, subscribers will have a choice of schemes with different portfolios and different risk profiles.

"One of the schemes will provide for investment of the subscriber's funds in government securities alone. Therefore, there is no element of compulsion to invest in equity," he said.

To another question, Chidambaram said Insurance Regulatory Development Authority has issued a roadmap to de-tariff all categories of general insurance business, including vehicle insurance, with effect from January 1.

"Every insurer would have to develop its own scientific basis of rating the risks, which would have to be filed with the IRDA and would ensure that the basis is technically sound," he said.

Replying to another query, Chidambaram said seven directors of Autoriders Finance Ltd have resigned during the last six years. Information about their involvement in the Rs 50 crore (Rs 500 million) UTI scam is being collected.

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