Goldman Sachs Asset Management is expanding in India with the acquisition of Benchmark Asset Management, an Indian exchange-traded fund provider with $700 million in assets under management.

The acquisition is expected to close later in the year, subject to regulatory approvals. The terms of the transaction have not yet been disclosed.

GSAM, which currently has a team of eight based in Mumbai headed by Prashant Khemka, currently provides research for offshore funds including Indian equities and BRIC equities. The firm is looking to bring actively managed on-shore funds to India, it said in a statement.

“As index and ETF product demand continues to grow significantly in India, Goldman Sachs’ local expertise and global platform will provide us the opportunity to grow further and enhance our offering for clients,” said Sanjiv Shah, executive director and co-founder of Benchmark Asset Management

“India is one of the world’s largest growth markets and a strategic priority for our firm," said Oliver Bolitho, head of GSAM in Asia.

Goldman Sachs Asset Management, the asset management arm of the Goldman Sachs Group, manages $840 billion in assets, as of end-December 2010.