Finance Ministry begins session with traders to launch world Exchange Traded Fund in present fiscal

New Delhi: The Finance Ministry has began session with world traders for launching CPSE-scrip based mostly Exchange Traded Fund (ETF) in abroad market within the present fiscal, a authorities official has stated.

The Department of Investment and Public Asset Management (DIPAM) will begin creating the index for the ETF-based on traders’ suggestions about demand of sector particular shares.

“We are eyeing large overseas pension funds for investments into the overseas ETF. We will soon appoint fund managers for developing the new ETF. Global roadshows have seen good investor interest in ETF route for investments into CPSEs,” the official stated.

The authorities presently has two exchange-traded funds — CPSE ETF and Bharat-22 ETF — listed on home exchanges. ETFs operate like a mutual fund scheme and have underlying belongings of government-owned firms.

File picture. AFP.

Bharat-22 ETF, which was launched in 2017-18, has 16 central public sector enterprises masking six sectors, three public sector banks and three non-public sector firms the place the federal government holds minority stake.

CPSE-ETF includes shares of 11 firms — ONGC, Coal India, Indian Oil Corp, Power Finance Corp, REC, Bharat Electronics, Oil India, NTPC, NBCC (India), NLC India and SJVN Ltd.

The authorities has already raised Rs 32,900 crore via two tranches and an extra fund provide of Bharat-22 ETF, and Rs 38,000 crore in 5 tranches of CPSE ETF within the home market.

The authorities has budgeted to gather Rs 90,000 crore via CPSE disinvestment within the present fiscal as in opposition to Rs 85,000 crore mopped up in 2018-19.

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