Aditya Agarwal, the Country Manager of Morningstar India, has 20 years of experience in the financial services and investment management industry. He was the promoter of one of India’s leading fund research companies, ICRA Online, and is highly regarded as a subject matter expert on mutual funds. In a conversation with Professor Vikram Kuriyan and Nupur Pavan Bang of the ISB’s Centre for Investment, Agarwal discussed the reasons for the slow growth of the Indian mutual funds industry compared to developed markets and explained why investor education and awareness is required.
India accounts for 18% of the world’s population but only 0.37% of the global mutual funds industry in terms of assets under management, as per data from the Investment Company Institute. India has one of the highest savings rates in the world at about 33% for the year 2012. But this money does not find its way into the stock markets or mutual funds. Why is this so?