Finland - Society and Economy

[jouni]

Btw, why should we care about pension fund? what does it prove?

This is the first economic discussion where someone pointed out pension fund as an indicator. How does it affect anything in the economy, other than being a savings instrument? And savings rate is higher for India- 30% vs 20% of Finland.

Gross National Savings (% of GDP) Data for All Countries

This whole thread makes no sense.

If your pension fund is not relevant, could you then with few sentences explain how Indian pension system works?

 

[Rashna]

Well it seems to be that way as of now. Apparently public debt is now 60% of GDP.

Suomen julkinen velka ylittää pian lamavuosien hirmuluvut 1990-luvulta | Yle Uutiset | yle.fi

http://blogs.lse.ac.uk/europpblog/2...nomic-problems-which-risk-undermining-growth/

Many posters here say that west is in the brink of collapse because of public debt. I wanted to show that we have more assets than debt. It is good to see the whole picture.

 

[Rashna]

You need to be focusing on public debt as a percentage of GDP.

List of countries by public debt - Wikipedia, the free encyclopedia

As a percentage of GDP finland's public debt has reached 60% which is alarming.

If your pension fund is not relevant, could you then with few sentences explain how Indian pension system works?

 

[jouni]

You need to be focusing on public debt as a percentage of GDP.

List of countries by public debt - Wikipedia, the free encyclopedia

As a percentage of GDP finland's public debt has reached 60% which is alarming.

We have almost 300Bn assets and 100Bn debt. Interest rates are really low. It would still nice to know Indian assets, how large they are.

 

[Sakal Gharelu Ustad]

If your pension fund is not relevant, could you then with few sentences explain how Indian pension system works?

You can sit on a huge pension fund and it is invested in both short and long term instruments. It makes no sense to compare two countries based on what their pension fund size are. Specially if one of them is largely into organized and another in unorganized sector.

Most of the Indians have savings in gold and other govt. bonds which do not classify as pension fund. India roughly has some 15,000 tonne of gold in private hands which translates to 15,000*$35 million/tonne= huge amount.

https://mises.org/library/gold-india’s-capital-asset-through-history

So this comparison makes no sense. There are many different assets a country can have and looking at a small pension fund is futile debate because there are so many other parameters.

P.S. Indian saving rate is 30%, which means some $600 billion saving by common Indians every year.

 

[jouni]

You can sit on a huge pension fund and it is invested in both short and long term instruments. It makes no sense to compare two countries based on what their pension fund size are. Specially if one of them is largely into organized and another in unorganized sector.

Most of the Indians have savings in gold and other govt. bonds which do not classify as pension fund. India roughly has some 15,000 tonne of gold in private hands which translates to 15,000*$35 million/tonne= huge amount.

https://mises.org/library/gold-india’s-capital-asset-through-history

So this comparison makes no sense. There are many different assets a country can have and looking at a small pension fund is futile debate because there are so many other parameters.

P.S. Indian saving rate is 30%, which means some $600 billion saving by common Indians every year.

Interesting, you really are into individual solutions, when we trust the government and only pay high taxes.

 

[Sakal Gharelu Ustad]

Interesting, you really are into individual solutions, when we trust the government and only pay high taxes.

It was just part of discussion to show that this comparison is meaningless. Rich people in Finland would have lots of wealth which cannot be accounted through pension funds.

So as I said, this discussion of comparing one sort of financial instrument is useless. Different country, different people, different investments.

 

[jouni]

It was just part of discussion to show that this comparison is meaningless. Rich people in Finland would have lots of wealth which cannot be accounted through pension funds.

So as I said, this discussion of comparing one sort of financial instrument is useless. Different country, different people, different investments.

Pension funds matter because they are for all of the citizen, regardless of wealth. How are Indian poor, how is their pension? Or Gold?

 

[Rashna]

@jouni

Pension funds investment corpus to cross $1 trillion by 2025
PTI Dec 8, 2013, 08.37PM IST




(The passing of the pensions"¦)
NEW DELHI: The passing of the pensions regulator act will spur growth of the investment corpus in the pensions sector to over $1 trillion by 2025, says a report jointly prepared by the Confederation of Indian Industry and global professional services firm Ernst & Young (EY).

"Investment corpus in the Indian pensions sector is estimated to reach greater than $1 trillion by 2025 as the sector moves forward to realize its full growth potential after the passage of the Pension Fund Regulatory and Development Authority (PFRDA) Act 2013, according to the CII-EY Report on Pensions Business in India," CII said in a release here Sunday.


The report said the pensions business presents an attractive opportunity because of India's changing demographics, an inadequate government-funded pensions system and the presence of a vibrant insurance and funds management sector.

"In line with India's demographic transition, the need for protecting old-age income security would underpin the growth of pensions market in India as the focus sharpens on expanding the coverage of National Pension System (NPS) in the private sector and the insurance companies, even as mutual funds assume greater role in the Indian pensions market", said Chandrajit Banerjee, director general, CII.

Pensions systems globally are key drivers of the infrastructure sector, providing stability in capital markets, the report said,

The government has set an investment target of $1 trillion for the infrastructure sector for the 12th Plan (2012-16) period, while it expects the private sector to contribute 45 percent of the targeted funding.

According to the report, private pension funds are likely to contribute 24 percent of the total corpus by 2025, while pensions and annuity products offered by life insurance companies are likely to account for around 16 percent.

The existing retirement funds corpus is in range of Rs.12-15 trillion, of which the Employees Provident Fund (EPF) makes up one-third of the total, while the Public Provident Fund (PPF) and NPS account for about 2.5 percent each.

The report said that by 2030, 180 million Indians or 12 percent of the population will be in the age bracket of 60-plus.

http://articles.economictimes.india...sector-private-sector-national-pension-system

 

[Sakal Gharelu Ustad]

Pension funds matter because they are for all of the citizen, regardless of wealth. How are Indian poor, how is their pension? Or Gold?

To each his own. I hope you might have heard of the great Indian family system where everyone takes care of their elders. So, pension funds would develop in future.

 

[jouni]

 

[ezsasa]

@jouni

Pension funds investment corpus to cross $1 trillion by 2025
PTI Dec 8, 2013, 08.37PM IST




(The passing of the pensions"¦)
NEW DELHI: The passing of the pensions regulator act will spur growth of the investment corpus in the pensions sector to over $1 trillion by 2025, says a report jointly prepared by the Confederation of Indian Industry and global professional services firm Ernst & Young (EY).

"Investment corpus in the Indian pensions sector is estimated to reach greater than $1 trillion by 2025 as the sector moves forward to realize its full growth potential after the passage of the Pension Fund Regulatory and Development Authority (PFRDA) Act 2013, according to the CII-EY Report on Pensions Business in India," CII said in a release here Sunday.


The report said the pensions business presents an attractive opportunity because of India's changing demographics, an inadequate government-funded pensions system and the presence of a vibrant insurance and funds management sector.

"In line with India's demographic transition, the need for protecting old-age income security would underpin the growth of pensions market in India as the focus sharpens on expanding the coverage of National Pension System (NPS) in the private sector and the insurance companies, even as mutual funds assume greater role in the Indian pensions market", said Chandrajit Banerjee, director general, CII.

Pensions systems globally are key drivers of the infrastructure sector, providing stability in capital markets, the report said,

The government has set an investment target of $1 trillion for the infrastructure sector for the 12th Plan (2012-16) period, while it expects the private sector to contribute 45 percent of the targeted funding.

According to the report, private pension funds are likely to contribute 24 percent of the total corpus by 2025, while pensions and annuity products offered by life insurance companies are likely to account for around 16 percent.

The existing retirement funds corpus is in range of Rs.12-15 trillion, of which the Employees Provident Fund (EPF) makes up one-third of the total, while the Public Provident Fund (PPF) and NPS account for about 2.5 percent each.

The report said that by 2030, 180 million Indians or 12 percent of the population will be in the age bracket of 60-plus.

How much is 12 trillion INR in USD?

 

[Rashna]

Trillion is in USD usually. We can convert to Rupees. That Rupee sign is a mistake IMO.

If it is in rupees this is the conversion for 1 trillion Rupees


1000000000000 Indian Rupee equals
15733170000.000 US Dollar

How much is 12 trillion INR in USD?

 

[ezsasa]

Trillion is in USD usually. We can convert to Rupees. That Rupee sign is a mistake IMO.

If it is in rupees this is the conversion for 1 trillion Rupees


1000000000000 Indian Rupee equals
15733170000.000 US Dollar

Yup got it thanks.

 

[ezsasa]

Pension funds matter because they are for all of the citizen, regardless of wealth. How are Indian poor, how is their pension? Or Gold?

May be i am bad at math but at 12 trillion INR indian pension fund is atleast 188 billion.
How come 172 billion USD finnish pension fund is larger than india and russia combined?

 

[jouni]

May be i am bad at math but at 12 trillion INR indian pension fund is atleast 188 billion.
How come 172 billion USD finnish pension fund is larger than india and russia combined?

I had the figure of 125Bn for India and 45Bn for Russia. I guess that figure was wrong then, sorry. Finnish fund is smaller as it seems.India is the greater country economically.

 

[ezsasa]

I had the figure of 125Bn for India and 45Bn for Russia. I guess that figure was wrong then, sorry. Finnish fund is smaller as it seems.India is the greater country economically.

So can we consider the matter closed then?

 

[jouni]

So can we consider the matter closed then?

Yes we can.

 

[ezsasa]

Yes we can.

Thank you!!!

Moderators can we close this thread? Matter is settled,hence no need for further arguments.

 

[pmaitra]

Agreed @ezsasa and @jouni. Thread closed.