In contrast, local investors show a higher tolerance for local risk and have the ability to create diversified portfolios with greater opportunities.
The relationship between active and passive income
Investing passively in India, requires benchmarking the performance of a well-known index rather than choosing your own portfolio. India saw a 34% increase in assets under management in the 12 months ending March 2023, according to a report by the Association of Mutual Funds in India. This growth was fueled by low-cost ETFs and index funds, which showed an increase of 144% last year. Many investors, including Employees’ Provident Funds and pension funds, are attracted to mutual funds that only serve as a starting point in their investment journey.
The panelists agreed that active and passive income can coexist. Active funds provide expertise in asset allocation, while passive funds provide low-cost market access. Operating income remains important for long-term growth due to the slow pace of the Indian economy. Individual investors will continue to look for funds to provide guidance and support to even the most popular of funds.
Insurance for all
Although India has not yet entered the insurance sector, “insurance for all” has become a buzzword of late. The Insurance Regulatory and Development Authority of India is working on three strategies – access, availability and affordability – to ensure insurance for all by 2047. The success of social policies, such as the Pradhan Mantri Jeevan Jyoti Bima Yojana, has played an important role in creating awareness about insurance and increasing coverage. .
RM Vishakha, Managing Director and CEO at IndiaFirst Life Insurance, called for redefining the measurement of insurance penetration beyond conventional indicators such as GDP and premium percentage. He also proposed other measures such as assessing the living conditions of the people and their ability to earn money. The leaders also raised the importance of detailed analysis of data and the government’s insurance policy to address existing gaps and ensure that insurance is available.
Importance of Tech in insurance
Vishakha highlighted technology as an important part of the insurance industry. Insurers can thrive by automating operations, speeding up workflow, simplifying data and financial transactions, and streamlining customer experience. Technology can also streamline insurance products, make them more accessible to customers and improve availability. Vishakha also spoke about the importance of modern technology to detect and prevent fraud work during menstruation.
Onus on investor education
Investor education is everyone’s responsibility, and Subramanian emphasizes the key role investment companies have to educate and inform investors, including managing risk awareness and potential returns. This is especially important in markets with low volatility, where persuading investors to consider alternative investment options remains difficult.
Authority is profit
In addition to financial education, the group also discussed the importance of good governance and the long-term benefits of investment decisions. Nilesh Shah, Group President & Managing Director, Kotak Mahindra Asset Management Company, emphasized the three pillars of strong governance, transparency and ethics to achieve sustainable profitability. Strategic management is essential for strategic decision-making and distribution, Shah said, pointing out the negative effects of a lack of trust management on suppliers.
A path to future opportunities
As India’s growth trajectory unfolds, these insights can become beacons. Buyer leaders must continue to seek sustainable growth, integration and long-term growth to unlock it. India’s great potential.
The group agreed that, by following these principles and staying on the current path, India can confidently strengthen its position as an important global power.