The Pension Fund Regulatory and Development Authority has constituted a committee of investment experts on Strategic Asset Allocation and Risk Governance (SAARG) to review and modernise the investment framework under the National Pension System (NPS). The panel will examine existing investment guidelines, benchmark them with global pension systems, and suggest reforms to strengthen long-term retirement wealth creation, diversification, risk control and subscriber choice.
Committee Mandate
SAARG has been given a broad review mandate covering the full NPS investment architecture. It will assess the adequacy and relevance of current guidelines for both Government and Non-Government sector subscribers. It will also compare the NPS framework with leading global pension models and the Indian investment ecosystem.
Asset Allocation and New Instruments
The committee will study strategic asset allocation across equity, debt, money market and alternative assets. It will also review permitted asset classes and consider the introduction of new ones to reduce exposure to geopolitical, macroeconomic and market-cycle risks. Prudential exposure and concentration limits will also be examined.
Risk, Valuation and Liquidity Framework
SAARG will recommend stronger risk management practices covering market, credit, liquidity, concentration and operational risks. It will also look at asset-liability management principles for pension liabilities. In addition, it will review valuation standards for Alternative Investment Funds, portfolio stability measures such as Held-to-Maturity treatment for government securities, and liquidity tools such as Securities Lending and Borrowing Mechanism and triparty repo arrangements.
Governance, Sustainability and Subscriber Choice
The panel will examine custodial architecture, intermediary processes and performance benchmarking for pension funds. It will also assess the integration of climate transition risks and net-zero considerations in investment decisions. Subscriber choice structures, including lifecycle and target-date options, along with the balance between active and passive strategies, will be reviewed. The committee is chaired by Shri Narayan Ramachandran and will submit its report within nine months.
Last Modified: April 27, 2026