Indian Mutual Fund Industry:Challenges and Road Ahead

Mutual funds as an investment vehicle have currently gained immense popularity in India as reflected in the robust growth levels of assets under management. The Indian mutual fund industry has witnessed a sharp growth in past several years at about CAGR of 28% from 2006-11. However, Indian mutual fund industry is yet to travel a long distance as the contribution of the industry is still less than 0.5% of the global assets under management. Assets under management as a percentage of GDP is less than 5 per cent in India as compared to 70 per cent in the US, 61 per cent in France and 37 per cent in Brazil. The paper attempts to assess the performance of Indian mutual fund industry, its comparison with world markets, challenges faced by the industry and road ahead for mutual fund industry.