India's government has granted private retirement funds permission to...

India’s government has granted private retirement funds permission to invest in units of mutual funds that invest solely in government securities. Before the change, employer-sponsored pension funds, with about $22.5 billion in assets, could invest in government bonds only by buying them from authorized primary dealers. The change became effective April 1, but the government said there will not be any changes in pension funds’ maximum allocations to different asset classes. Pension funds must invest 25% of assets in central government securities; 15% in state government securities; 40% in infrastructure; and the remaining 20% can be split among the three categories. The easing of the rules is expected to result in the launch of a number of 100% gilt mutual funds.