The ambitious scheme, which aims to broaden share ownership, re-energise an unprofitable mutual fund industry and bring some structure to a patchy investment landscape, faces formidable barriers - not least India's love affair with gold.
India has one of the world's highest savings rates, at over 30 percent - more than double the United States - and the bulk of the nation's $800 billion in savings is parked in gold.
India is the world's biggest gold buyer and holds $1 trillion worth of the precious metal, World Gold Council data shows - more than the combined military spending by the United States, China, Russia and Great Britain.
"Gold holds an emotional charm for most Indians. Those are some big shoes to fill for any sort of investment," said V Ramesh, Deputy CEO of the Association of Mutual Funds in India.