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India’s Retirement Gap Prompts PFRDA Call for Greater Savings
When people stop working, they need money to pay for their lives.
In India, retirement income currently replaces only about 35–40% of a worker’s earlier income.
Around 60% is often considered a useful global level.
PFRDA chief S. Ramann said people may need to save more while they are working.
The right amount is different for each person because lifestyles and incomes differ.
Saving regularly for a long time can help money grow, although returns are not guaranteed.
PFRDA wants more self-employed workers, gig workers, farmers and small-business workers to join pension plans.
It also wants to make joining these plans easier through digital services.
India’s retirement-income replacement rate is estimated at 35–40%, below the global benchmark of about 60%.
PFRDA chairman S. Ramann said people should save more, while noting that required retirement funds vary by income, lifestyle and priorities.
An illustration cited by Ramann said investing ₹2,000 monthly could potentially grow to around ₹10 lakh after 18 years, based on past performance.
As of 16 August 2026, NPS had 2.30 crore subscribers and APY had 7.86 crore active subscribers.
PFRDA aims to reach 30 crore combined NPS and APY subscribers within four to five years, focusing on non-government workers.
- Who
- PFRDA chairman S. Ramann and the Pension Fund Regulatory and Development Authority.
- What
- Ramann explained India’s low retirement-income replacement rate and urged greater long-term retirement saving and wider pension coverage.
- Where
- Chennai, India.
- When
- The comments were reported after an interaction in Chennai on Friday; subscriber figures cited by PFRDA were current as of 16 August 2026.
- Why
- India’s replacement rate is below the roughly 60% global level, while many workers outside the government sector remain outside formal pension coverage.
Key facts
- India’s replacement rate
- About 35–40% of pre-retirement income.
- Global level cited
- About 60%.
- Illustrative contribution
- ₹2,000 per month could potentially accumulate to around ₹10 lakh after 18 years, based on past performance.
- NPS subscribers
- 2.30 crore as of 16 August 2026.
- APY active subscribers
- 7.86 crore as of 16 August 2026.
- PFRDA target
- 30 crore combined NPS and APY subscribers within four to five years.
- Target workers
- Self-employed people, gig workers, farmers and workers in MSMEs, among others.
Quotes
S. Ramann
Chairman of the Pension Fund Regulatory and Development Authority
“Roughly, the world says your replacement rate should be about 60%”
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Sources
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