Print ISSN: 2204-1990

Online ISSN: 1323-6903

Keywords : HH Index


COMPETITIVENESS OF PENSION FUNDS IN INDIA

Pushpa B.V

Journal of Contemporary Issues in Business and Government, 2021, Volume 27, Issue 2, Pages 4489-4496
DOI: 10.47750/cibg.2021.27.02.474

There are two groups of firms or companies in a market to influence the price of their
products, namely, the price markers and price takers. The extent of market power and market
concentration of these companies determine to which group they fall under. These issues
needs a thorough discussion especially at the present time when Indian economy has shown a
phenomenal trend because of changes in government policies as well as changing trends in
lifestyle and saving pattern of people. Change in market concentration leads to change in
market power. As concentration rate increases, level of competition decreases and vice versa.
The issue is how to measure and interpret meaningfully the level or extent of market
competition of the companies operating in pension market in India. Concentration Ratio (CR)
and the Herfindahl-Hirschman Index (HHI) are two indicators. The present paper studies
intensity of competition in pension market using the Herfindahl-Hirschman Index (HHI). The
study provides inputs to the government & organizations to bring in further competitive
strategies to benefit organisations. The H indices indicate near perfect behaviour of ICICI,
Kotak, Reliance, HDFC & Birla Sun Life pension funds. SBI & UTI pension funds are
monopolistic & exhibit monopoly power in their earnings. Given the present position,
Pension Market Players (PMP) have a huge opportunity in Indian scenario as almost 94% of
the total working population are not covered so far.