ESIC Can Invest Up to 15% Surplus Funds in Equity Through ETFs

The Employees State Insurance Corporation(ESIC) can now invest up to 15 per cent of its excess fund into equity after the Centre allowed the body to do so.

The Employees State Insurance Corporation(ESIC) can now invest up to 15 per cent of its excess fund into equity after the Centre allowed the body to do so. The social security body can invest its surplus fund in equity through exchange traded funds.

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Why This Transition

The decision to invest surplus funds into equity was taken due to the low returns on debt instruments and the need to diversify the corporation’s portfolio. Initially, the investment will be restricted to exchange-traded funds.

What Has Been Said:

“The initial investment shall start at 5 per cent and increase up to 15 per cent gradually, after review of two quarters. The investment will be confined in ETFs, i.e., Nifty50 and Sensex. It will be managed by fund managers of Asset Management Companies (AMCs). The equity investment will be monitored by existing custodian, external concurrent auditor and consultant looking after the debt investments in addition to the management of the ETF for equity”, the statement said.

What More To Do:

Besides, the minister also emphasised strengthening the infrastructure at ESIC hospitals and dispensaries and approved the setting up of a new 100 bedded ESIC Hospital at Shyamlibazar, Agartala, Tripura and Idukki.

Further, it was also decided to execute the capital works in ESIC through Central / State PSUs besides the Central Public Works Department (CPWD). A fresh empanelment of such central / state PSU will be invited by the ESIC for empanelment in due course.

ESIC gave in-principal approval for the execution of Annual Repair Maintenance & Operational work (ARMO) and Special Repair (SR) works by the Engineering Wing under the Project Management Division (PMD) of ESI Corporation.

About ESIC:

Employees’ State Insurance Corporation (ESIC) is one of the two main statutory social security bodies under the ownership of Ministry of Labour and Employment, Government of India, the other being the Employees’ Provident Fund Organisation. The fund is managed by the Employees’ State Insurance Corporation (ESIC) according to rules and regulations stipulated in the ESI Act 1948.

Minister of Labour & Employment:- Bhupender Yadav

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