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Mehta counts on mutual funds to ease capital crisis

Addressing the annual general meeting of the Association of Mutual Funds in India, Mehta said that mutual funds were the leading players in the markets abroad, and even in India, last year, over half the money raised from the markets were contributed by these.

However, in the changing scenario, these funds must strengthen their board of trustees and bring in professionals. "We will have to develop these institutions for the development of our market," he said.

He said the Indian capital market was safe and stable despite several adverse factors. "Our market was affected due to the South-East Asian market crisis but not to the extend as had happened in Hong Kong or Tokyo stock markets," Mehta said.

Welcoming the AMFI's plan to identify major areas of improvement, he said that of the 21 mutual funds schemes, 20 had outperformed the growth of the BSE sensitive index during the first quarter of the current fiscal year (April-June).

AMFI chairman A P Kurian said, "We have developed an enlightened relationship with the SEBI and are committed to improve the professional standard of the Indian mutual funds industry."

Expressing concern over the present market situation, Kurian, who became a full-time chairman of AMFI this year, said mutual funds were sensitive to the market development and wished to be involved in market reforms.

Therefore, he continued, the industry must be allowed to get into schemes related to pension funds for retired and needy persons. This has great potential for growth in future. In USA, about one-third of the total collection in mutual funds industry comes from pension funds, he added.

UNI