Pension reforms: PFRDA plans NPS fund-of-funds; will new AIF framework boost long-term capital flow?
Speaking at IVCA DII & Exits 2025, he said the regulator has spent recent years building clearer classifications and stronger governance for alternate assets, according to PTI.Ramann said PFRDA has now classified all alternate investment instruments into equity and debt, following Sebi’s decision to categorise Real Estate Investment Trusts (REITs) as equity.
“Over the last few years, we have worked to classify alternate assets more clearly, strengthen governance structures, and build a centralised and transparent NPS fund-of-funds platform that can select AIFs with rigour and credibility,” he said.He added that such a framework will allow every pension fund — “large or small” — to deploy capital confidently without compromising prudence.Emphasising the role of domestic long-term pools, Ramann said, “India’s next phase of capital formation must be built on strong domestic pools of patient capital.
Pension assets, by design, are long-term and stable, and our effort at PFRDA is to create a framework that allows these funds to participate meaningfully in India’s private market growth.”He noted that risk capital is cyclical but argued that a well-diversified AIF portfolio, backed by strong oversight and long horizons, can still deliver beneficial outcomes for NPS subscribers.Ramann said India cannot rely solely on seven- to ten-year fund structures and needs to adopt longer-tenor and perpetual vehicles that reflect the true nature of retirement savings.
“If India is to unlock the full power of domestic institutional investors, we must align incentives, deepen trust through process excellence, and enable wider participation from pension, insurance, and retirement assets.
The opportunity is immense, and with the right guardrails, domestic capital can become a powerful anchor for India’s long-term growth story,” he said.
