Mutual Funds Industry Will Play Big Role In ‘Viksit Bharat’: Sundeep Sikka at IES 2024

India Economic Summit : At the fourth edition of Republic Media Network's India Economic Summit , Sundeep Sikka, ED and CEO at Nippon Mutual Funds, emphasised the role of the mutual funds industry will be playing towards achieving the resolution of ‘Viksit Bharat’. 

Sikka discussed the changing landscape of investing in India, the role of mutual funds in financial inclusion, and the economic policies that are contributing to India’s long-term growth.

“Today, 54% of all new SIPs are coming from smaller cities and towns. The foundation of this shift was laid by key policy reforms like Jan Dhan, demonetization, and the introduction of unified KYC. In 2014, the mutual fund industry was worth Rs 9 lakh crores, and today it stands at Rs 70 lakh crores. This is a significant growth, driven largely by small investors from small cities and towns,” said Sundeep Sikka.

‘Mutual Funds Word Searched More on Google In Smaller Cities’

He further emphasized that the perception of mutual funds in rural areas has undergone a complete transformation compared to the past.

“I think when we go to small cities and towns, the mutual funds were something, it was an alien product. People did not understand. Now, if you go to Google Trends, the data tells you the mutual fund word is being searched more in smaller cities than bigger cities. The fastest growing cities are, let's take Nasik, Durgapur, smaller cities,” he said. 

Sundeep Sikka Hopeful of Every Indian Household Becoming Mutual Fund Investor By 2047 

He also touched upon the growing interest in mutual funds and the cultural shift away from traditional savings methods, like bank deposits and physical gold. 

"Till now, investing was done for a very different reason. For the first time, this Diwali , we saw a very different change. The highest volume of mutual fund ETFs was traded on the stock exchanges on Dhanteras. Till now, Indians wanted to invest in gold physically. Last year, it was Rs 80 crores. This time, it's almost Rs 450 crores. So the trend is changing and it's changing faster than what we can expect. And today, we have 5 crore unique investors. And I think that day will not be far away. I think you talked about 2047 when I think we will be a $50 trillion economy. I think it's our dream and wish. I think every Indian household will be a mutual fund investor by then,” he said.

‘ Stock Market is Economy's Reflection’

While refraining from predicting the future of the Indian stock market trajectory, Sikka said that the stock market does perform well when the economy booms. 

“I don't think anybody in the room can predict where the stock markets are headed. But I think what is very important to understand, stock market is a reflection of the economy. If the economy does well, the stock market also do well. So again, for me, when I say this, I always say direction is more important than speed. So as a country, we're in the right direction,” Sikka said. 

The India Economic Summit, held at the Republic’s headquarters—the largest news center in Asia—brought together policymakers and industry leaders to discuss India's economic future. This year’s theme, "Viksit Bharat: Bullseye," focused on envisioning a $50 trillion economy by 2047.