Panaji, Feb 20 (IANS) RBI governor Raghuram Rajan Friday said that ideally, pensions for the elderly should not just be inflation-indexed but also indexed for real-value (which adjusts for the effect of inflation).
He said this while stressing the need for curbing inflation as it works as a tax against those in their twilight years.
Speaking during an ongoing lecture series here, the Reserve Bank of India (RBI) governor also made a case for equity-linked pension while admitting that as India gets richer, pension in the current form does not help preserve the status of an individual like it used to a decade ago.
"The government can create a minimal pension, which it has in a number of areas, especially for the very poorly off in society. But going forward we have to develop better methods of savings. Savings that ensure... that your pensions are not just inflation-indexed, but even real-value indexed," Rajan said.
He also said that to ensure that pensions are indexed at real value, linking the pension corpus to equity was important.
"So in those kinds of saving plans I think some amount of equity is very important," Rajan said.
The top official also admitted that in contemporary India, with its upward rising economic trajectory, mere pensions could not alone could not guarantee the same economic solace as they used to in the past.
"But there's another aspect to pensions which are a source of concern for the elderly, that is the country is becoming richer so a pension today does not preserve the same status even if it is inflation indexed, that it would have got you 10 years ago because everyone else is moving ahead," he said.
Rajan said that it was imperative to arrest inflation, because it ended up taxing those in the twilight years of their lives.
"I hope that unlike China we will grow wealthy before we grow old. China unfortunately is growing old before it really gets wealthy.
"Hopefully, we will not face the same situation. So we should be prepared and therefore pensions I think are one extremely issue today," the RBI governor added.
Himachal to host conference of public service commissions
Shimla, March 5 (IANS) The Himachal Pradesh Public Service Commission (HPPSC) will host a three-day national conference of state public service commission chairpersons in the state capital from
Water crisis in Delhi: LG said- UP-Haryana is giving water of the prescribed quota, this is the result of mismanagement of water shortage
The Lieutenant Governor and the Delhi Government are once again at loggerheads over the issue of water in the capital. Lieutenant Governor VK Saxena alleged that the Delhi Government's irresponsible
Modi hits back at critics, Ready to bend on land bill
New Delhi, Feb 27 (IANS) Prime Minister Narendra Modi Friday said his government was willing to bend on the controversial land acquisition bill if there was anything anti-farmer, and pledged not to
Russia-Ukraine War Updates: Now 45 lakh people left Ukraine due to the Russian attack, the economy also lost more than 45%
It has been more than 45 days since the Russia-Ukraine war. The devastation that has wreaked havoc on the cities of Ukraine these days has shocked the whole of humanity. According to a UN report, 4.5
74 thousand patients increased in 24 hours, more than 76 thousand people also recovered; 902 infected died; 66.22 lakh cases so far
The number of corona patients in the country has increased to 66 lakh 22 thousand 136. It is a matter of relief that 55 lakh 83 thousand 414 people have been cured so far. 1 lakh 2 thousand 714
'Operation Sindoor is going on...', Rajnath Singh reveals; 100 terrorists killed in India's action.
Defence Minister Rajnath Singh said in the all-party meeting that at least 100 terrorists were killed in Indian strikes under Operation Sindoor.
After Kanpur, there is a conspiracy to overturn a train in Ajmer! Heavy stones were placed on the railway track; goods trains collided
Ajmer Train Conspiracy After Kanpur in UP, now a case of conspiracy to overturn a train has come to light in Rajasthan. Heavy cement blocks have been found on the railway track in Ajmer, Rajasthan.
CISF commandos helping Metro's women commuters at night
New Delhi, March 9 (IANS) Apart from providing security to women travelling in the Metro trains, the CISF's women commandos are also providing help to women commuters who require it for getting
Political turmoil in Pakistan: Shahbaz became the 23rd Prime Minister, instead of the President, the Senate Chairman administered the oath; Modi also congratulated Shahbaz
Shahbaz Sharif has become the 23rd Prime Minister of Pakistan. Shahbaz was administered the oath by Senate Chairman Sadiq Sanjrani. Surprisingly, President Arif Alvi did not come to administer the
Chardham Yatra; Road incomplete, hotels suffering from disaster: New cracks on the way to Badrinath can become a cause of danger
New cracks on the main road going to Badrinath via Joshimath for Chardham Yatra can become a cause of danger. The work on the 15 km all-weather road from Helang to Joshimath has not been completed
