The Importance of Inflation Index Assets in India

The National Pension Scheme (NPS) was launched in 2004. While the older pension scheme offered defined benefits to all government employees without any contribution on their part, the NPS requires employees to contribute a sum throughout their working years. Almost two decades after the NPS came into effect, several States are switching back to the Old Pension Scheme (OPS). Earlier this year, the Central government set up a committee under the leadership of the Finance Secretary to review the working of the NPS and evolve an approach that addresses the needs of government employees while maintaining fiscal prudence.

Here we discuss whether States should return to the OPS.

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