<PAGE>
[LOGO OF EATON VANCE APPEARS HERE] Investing
for the [PHOTO OF EARTH FROM SPACE
APPEARS HERE]
21st
Century/R/
Semiannual Report June 30, 1998
[PHOTO OF INDIAN TEMPLE & STATUE APPEARS HERE]
EATON VANCE
GREATER INDIA
FUND
Eaton Vance
Global Management - Global Distribution
[PHOTO OF INDIAN COUNTRYSIDE & ELEPHANT W/RIDERS APPEARS HERE]
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
INVESTMENT UPDATE
[PHOTO OF B.N. MANJUNATH CO-PORTFOLIO MANAGER AND CHIEF REPRESENTATIVE, BOMBAY
APPEARS HERE]
B.N. Manjunath,
Co-Portfolio Manager
and Chief Representative,
Bombay
Investment Environment
------------------------------------------------------------------------------
The India Market
. Domestic and regional politics have once again cast a shadow over the Indian
market. The victory of the nationalist Bhara-tiya Janata Party (BJP) in March
suggested yet another weak coalition government. Meanwhile, India and Pakistan
resumed nuclear testing, to the consternation of the world community.
. The Indian market, which lost ground following the nuclear tests, nonetheless
outperformed many other Asian markets in the six months ended June 30, 1998.
The Bombay Stock Exchange Index had a total return of -16.3% during that same
period./1/
. Most political observers agree that, despite its sometimes strident rhetoric,
the BJP-led government is likely to continue along the path of economic reform
established by its predecessors. BJP has already vowed to defend the rupee. As
to the broad economy, Business Monitor International estimates that India will
generate GDP growth of 6.5% in fiscal year 1999.
The Fund
------------------------------------------------------------------------------
Performance for the Past Six Months
. The Fund's Class A shares had a total return of -13.9% during the six months
ended June 30, 1998./2/ This return resulted from a decrease in net asset
value per share (NAV) to $5.44 on June 30, 1998 from $6.34 on December 31,
1997.
. The Fund's Class B shares had a total return of -14.5% during the six months
ended June 30, 1998./2/ This return resulted from a decrease in net asset
value per share (NAV) to $5.34 on June 30, 1998 from $6.23 on December 31,
1997.
Recent Portfolio Developments
. In a changing political climate, the Portfolio focused predominantly on
consumer-oriented companies enjoying fairly stable earnings growth. The
Portfolio's largest sector weightings at June 30, 1998 were household
products, computer software, consumer products and medical products.
. With industrial production rising at a slow 5% rate through most of fiscal
year 1998 and the government cutting back on spending, the Portfolio limited
its exposure to cyclical sectors. While reducing its investments in auto
companies, the Portfolio maintained an investment in Punjab Tractors Ltd.,
India's largest integrated manufacturer of tractors and equipment for the key
agricultural sector.
. The Portfolio remained very selective in the petrochemical sector. Its largest
chemical holding, Hoechst Schering Agrevo Ltd., is a major player in the
agrochemical and pesticide industries. The agricultural sector remains a very
important segment of the Indian economy.
Selected Portfolio Investments
. Hindustan Lever Ltd. was the Portfolio's largest holding at June 30, 1998.
Lever is India's largest producer of personal care products, such as soaps,
deodorants and toothpaste. The company also has a growing export business for
tea, garments and footwear.
. Infosys Technologies Ltd. was another major investment in India's surging
software sector. India has become a major global source of programming talent
in the past decade. Infosys specializes in software for banks, brokerage
companies and other financial applications.
. In the high-growth telecom industry, the Portfolio had an investment in
Mahangar Telephone Nigam Ltd. The company enjoys near-monopoly status as the
provider of telephone services in Mumbai and Delhi, and is a good example of
the government's recent efforts at privatizing industry.
Mutual fund shares are not insured by the FDIC and are not deposits or other
obligations of, or guaranteed by, any depository institution. Shares are subject
to investment risks, including possible loss of principal invested.
- --------------------------------------------------------------------------------
Fund Information
as of June 30, 1998
Performance/3/ Class A Class B
- --------------------------------------------------------------------------------
Average Annual Total Returns (at net asset value)
- --------------------------------------------------------------------------------
One Year -27.2 -27.2%
Life of Fund+ -13.5 -14.0
SEC Average Annual Total Returns (including sales charge or applicable CDSC)
- --------------------------------------------------------------------------------
One Year -31.4 -30.8%
Life of Fund+ -14.8 -14.5
+Inception date: 5/2/94
Ten Largest Holdings/4/
Hindustan Lever Ltd. 17.0%
Infosys Technologies Ltd. 12.8
Hoechst Marion Roussel Ltd. 6.1
Hindustan Petroleum Corp. 5.3
ITC Ltd. 4.9
Punjab Tractors Ltd. 4.5
Lever Brothers Pakistan Ltd. 3.8
Hoechst Schering Agrevo Ltd. 3.8
NIIT Ltd. 3.1
Bajaj Auto Ltd. 3.0
/1/ It is not possible to invest directly in an Index./2/ These returns do not
include the 5.75% maximum sales charge for the Fund's Class A shares or the
applicable contingent deferred sales charges (CDSC) for the Fund's Class B
shares./3/ Returns are historical and are calculated by determining the
percentage change in net asset value with all distributions reinvested. SEC
average annual returns for Class A reflect a 5.75% sales charge; for Class
B, returns reflect applicable CDSC based on the following schedule: 5%-1st
and 2nd years; 4%-3rd year; 3%-4th year; 2%-5th year; 1%-6th year./4/ Based
on market value as of 6/30/98. Ten largest holdings represent 64.3% of the
Portfolio's net assets. Holdings are subject to change.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost.
2
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
FINANCIAL STATEMENTS (Unaudited)
Statement of Assets and Liabilities
As of June 30, 1998
Assets
- --------------------------------------------------------------------------------
Investment in South Asia Portfolio, at value
(identified cost, $54,877,934) $ 57,335,217
Receivable for Fund shares sold 14,053
Deferred organization expenses 24,212
- --------------------------------------------------------------------------------
Total assets $ 57,373,482
- --------------------------------------------------------------------------------
Liabilities
- --------------------------------------------------------------------------------
Payable for Fund shares redeemed $ 171,133
Payable to affiliate for Trustees' fees 946
Other accrued expenses 84,998
- --------------------------------------------------------------------------------
Total liabilities $ 257,077
- --------------------------------------------------------------------------------
Net Assets $ 57,116,405
- --------------------------------------------------------------------------------
Sources of Net Assets
- --------------------------------------------------------------------------------
Paid-in capital $ 84,275,352
Accumulated net realized loss from Portfolio
(computed on the basis of identified cost) (28,533,725)
Accumulated net investment loss (1,082,505)
Net unrealized appreciation from Portfolio (computed
on the basis of identified cost) 2,457,283
- --------------------------------------------------------------------------------
Total $ 57,116,405
- --------------------------------------------------------------------------------
Class A Shares
- --------------------------------------------------------------------------------
Net Assets $ 8,591,233
Shares Outstanding 1,580,683
Net Asset Value and Redemption Price Per Share
(net assets/shares of beneficial interest outstanding) $ 5.44
Maximum Offering Price Per Share
(100 / 94.25 of $5.44) $ 5.77
- --------------------------------------------------------------------------------
Class B Shares
- --------------------------------------------------------------------------------
Net Assets $ 48,525,172
Shares Outstanding 9,091,395
Net Asset Value, Offering Price and Redemption Price
Per Share (net assets/shares of beneficial interest
outstanding) $ 5.34
- --------------------------------------------------------------------------------
On sales of $50,000 or more, the offering price of Class A shares is reduced.
Statement of Operations
For the Six Months Ended
June 30, 1998
Investment Income
- --------------------------------------------------------------------------------
Dividends allocated from Portfolio
(net of foreign taxes, $5,561) $ 714,324
Expenses allocated from Portfolio (739,095)
- --------------------------------------------------------------------------------
Net investment loss from Portfolio $ (24,771)
- --------------------------------------------------------------------------------
Expenses
- --------------------------------------------------------------------------------
Management fee $ 93,858
Trustees fees and expenses 1,729
Distribution and service fees
Class A 29,128
Class B 313,684
Transfer and dividend disbursing agent fees 70,324
Printing and postage 50,664
Legal and accounting services 32,095
Registration fees 19,952
Amortization of organization expenses 14,220
Custodian fee 6,871
Miscellaneous 13,956
- --------------------------------------------------------------------------------
Total expenses $ 646,481
- --------------------------------------------------------------------------------
Net investment loss $ (671,252)
- --------------------------------------------------------------------------------
Realized and Unrealized
Gain (Loss) from Portfolio
- --------------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified cost basis) $ (9,481,760)
Foreign currency (236,729)
- --------------------------------------------------------------------------------
Net realized loss $ (9,718,489)
- --------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments $ 1,314,488
Foreign currency (5,265)
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) $ 1,309,223
- --------------------------------------------------------------------------------
Net realized and unrealized loss $ (8,409,266)
- --------------------------------------------------------------------------------
Net decrease in net assets from operations $ (9,080,518)
- --------------------------------------------------------------------------------
See notes to financial statements
3
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
Six Months Ended
Increase (Decrease) June 30, 1998 Year Ended
in Net Assets (Unaudited) December 31, 1997
- --------------------------------------------------------------------------------
From operations --
Net investment loss $ (671,252) $ (1,387,697)
Net realized loss (9,718,489) (5,155,543)
Net change in unrealized
appreciation (depreciation) 1,309,223 11,444,170
- --------------------------------------------------------------------------------
Net increase (decrease) in net
assets from operations $ (9,080,518) $ 4,900,930
- --------------------------------------------------------------------------------
Transactions in shares of
beneficial interest --
Proceeds from sale of
shares
Class A $ 1,501,574 $ 15,139,542
Class B 2,772,938 --
Cost of shares redeemed
Class A (4,085,960) (25,889,063)
Class B (15,322,763) --
- --------------------------------------------------------------------------------
Net decrease in net assets from Fund
share transactions $(15,134,211) $(10,749,521)
- --------------------------------------------------------------------------------
Contribution from EV
Traditional Greater India Fund $ 12,518,640 $ --
- --------------------------------------------------------------------------------
Net decrease in net assets $(11,696,089) $ (5,848,591)
- --------------------------------------------------------------------------------
Net Assets
- --------------------------------------------------------------------------------
At beginning of period $ 68,812,494 $ 74,661,085
- --------------------------------------------------------------------------------
At end of period $ 57,116,405 $ 68,812,494
- --------------------------------------------------------------------------------
Accumulated net
investment loss included
in net assets
- --------------------------------------------------------------------------------
At end of period $ (1,082,505) $ (345,915)
- --------------------------------------------------------------------------------
Statement of Cash Flows
For the Six Months Ended
June 30, 1998
Increase (Decrease) in Cash (Unaudited)
- --------------------------------------------------------------------------------
Cash Flows From (Used For) Operating Activities --
Purchase of interests in South Asia Portfolio $ (3,833,346)
Withdrawal of interests in South Asia Portfolio 20,091,041
Operating expenses paid (672,042)
- --------------------------------------------------------------------------------
Net cash from operating activities $ 15,585,653
- --------------------------------------------------------------------------------
Cash Flows From (Used For) Financing Activities --
Proceeds from shares sold $ 4,282,273
Payments for shares redeemed (19,867,926)
- --------------------------------------------------------------------------------
Net cash used for financing activities $(15,585,653)
- --------------------------------------------------------------------------------
Net increase in cash $ --
- --------------------------------------------------------------------------------
Cash at Beginning of Period $ --
- --------------------------------------------------------------------------------
Cash at End of Period $ --
- --------------------------------------------------------------------------------
Reconciliation of Net Decrease in Net Assets
From Operations to Net Cash From
Operating Activities
- --------------------------------------------------------------------------------
Net decrease in net assets from operations $ (9,080,518)
Decrease in deferred organization expenses 14,220
Increase in payable to affiliate 434
Decrease in accrued expenses (40,215)
Net decrease in investments 24,691,732
- --------------------------------------------------------------------------------
Net cash from operating activities $ 15,585,653
- --------------------------------------------------------------------------------
See notes to financial statements
4
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
FINANCIAL STATEMENTS CONT'D
Financial Highlights
<TABLE>
<CAPTION>
Six Months Ended Year Ended December 31,
June 30, 1998 ---------------------------------------------------
(Unaudited) 1997 1996 1995 1994*
- ------------------------------------------------------------------------------------------------------------------------------------
Class A Class B Class B Class B Class B Class B
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value -- Beginning of period $ 6.340 $ 6.230 $ 5.910 $ 6.550 $ 9.840 $10.000
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment loss $(0.057) $ (0.072) $(0.126) $ (0.099)++ $(0.176) $(0.065)
Net realized and unrealized gain (loss) (0.843) (0.818) 0.446 (0.541) (3.114) (0.095)
- ------------------------------------------------------------------------------------------------------------------------------------
Total income (loss) from operations $(0.900) $ (0.890) $ 0.320 $ (0.640) $(3.290) $(0.160)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value -- End of period $ 5.440 $ 5.340 $ 6.230 $ 5.910 $ 6.550 $ 9.840
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return/(1)/ (14.20)% (14.29)% 5.42% (9.77)% (33.43)% (1.60)%
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's omitted) $ 8,591 $ 48,525 $68,812 $ 74,661 $21,041 $38,925
Ratios (As a percentage of average daily net
assets):
Expenses /(2)(3)/ 3.30%+ 3.84%+ 3.08% 2.88% 3.31% 2.54%+
Expenses after custodian fee reduction /(2)/ 3.22%+ 3.76%+ 3.05% 2.65% 2.90% --
Net investment loss (1.32)%+ (1.86)%+ (1.67)% (1.46)% (1.74)% (1.42)%+
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized.
++ Computed using average shares outstanding.
* For the period from the start of business, May 2, 1994, to December 31,
1994.
/(1)/ Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed
reinvested at the net asset value on the reinvestment date. Total return
is not computed on an annualized basis.
/(2)/ Includes the Fund's share of its Portfolio's allocated expenses.
/(3)/ The expense ratios for the year ended December 31, 1995 and periods
thereafter have been adjusted to reflect a change in reporting
requirements. The new reporting guidelines require the Fund, as well as
its corresponding Portfolio, to increase its expense ratio by the effect
of any expense offset arrangements with its service providers. The expense
ratio for the prior period has not been adjusted to reflect this change.
See notes to financial statements
5
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1 Significant Accounting Policies
----------------------------------------------------------------------------
Eaton Vance Greater India Fund (the Fund) is a mutual fund seeking long-term
capital appreciation through the purchase of an interest in a separate
investment company which invests primarily in equity securities of companies
in India and surrounding countries of the Indian sub-continent. The Fund is a
diversified series of Eaton Vance Special Investment Trust (the Trust). The
Trust is an entity of the type commonly known as a Massachusetts business
trust and is registered under the Investment Company Act of 1940, as amended,
as an open-end management investment company. The Fund offers two classes of
shares. Class A shares are sold subject to a sales charge imposed at the time
of purchase. Class B shares are sold at net asset value and are subject to a
contingent deferred sales charge (See Note 7). Both classes of shares have
equal rights to assets and voting privileges. Realized and unrealized gains
and losses and net investment income, other than class specific expenses, are
allocated daily to each class of shares based on the relative net assets of
each class to the total net assets of the Fund. Each class of shares differs
in its distribution plan and certain other class specific expenses. The Fund
invests all of its investable assets in interests in South Asia Portfolio
(the Portfolio), a New York Trust, having the same investment objective as
the Fund. The value of the Fund's investment in the Portfolio reflects the
Fund's proportionate interest in the net assets of the Portfolio (97.5% at
June 30, 1998). The performance of the Fund is directly affected by the
performance of the Portfolio. The financial statements of the Portfolio,
including the portfolio of investments, are included elsewhere in this report
and should be read in conjunction with the Fund's financial statements.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
A Investment Valuation -- Valuation of securities by the Portfolio is
discussed in Note 1A of the Portfolio's Notes to Financial Statements which
are included elsewhere in this report.
B Income -- The Fund's net investment income consists of the Fund's pro rata
share of the net investment income of the Portfolio, less all actual and
accrued expenses of the Fund determined in accordance with generally accepted
accounting principles.
C Federal Taxes -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its taxable income, including any
net realized gain on investments, if any. Accordingly, no provision for
federal income or excise tax is necessary. At December 31, 1997, the Fund,
for federal income tax purposes had a capital loss carryover of $18,360,028
which will reduce the taxable income arising from future net realized gains
on investments, if any, to the extent permitted by the Internal Revenue Code,
and thus will reduce the amount of the distributions to shareholders which
would otherwise be necessary to relieve the Fund of any liability for federal
income or excise tax. A portion of such capital loss carryovers were acquired
through the Fund Reorganization (See Note 8) and may be subject to certain
limitations. The amounts and expiration dates of the capital loss carryovers
are as follows: December 31, 2002 ($12,117), December 31, 2003 ($6,518,175),
December 31, 2004 ($6,182,815) and December 31, 2005 ($5,626,667).
Additionally, at December 31, 1997, net capital losses of $442,587 and net
currency losses of $411,253 attributable to security transactions incurred
after October 31, 1997, are treated as arising on the first day of the Fund's
next taxable year.
D Deferred Organization Expenses -- Costs incurred by the Fund in connection
with its organization, including registration costs, are being amortized on
the straight-line basis over five years.
E Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of revenue and expense during the reporting period. Actual results could
differ from those estimates.
F Other -- Investment transactions are accounted for on a trade date basis.
6
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
G Expense Reduction -- Investors Bank & Trust Company (IBT) serves as
custodian to the Fund and the Portfolio. Pursuant to the respective custodian
agreements, IBT receives a fee reduced by credits which are determined based
on the average daily cash balances the Fund or the Portfolio maintains with
IBT. All significant credit balances used to reduce the Fund's custodian fees
are reported as a reduction of expenses on the Statement of Operations.
H Interim Financial Statements -- The interim financial statements relating
to June 30, 1998 and for the six months then ended have not been audited by
independent certified public accountants, but in the opinion of the Fund's
management, reflect all adjustments, consisting only of normal recurring
adjustments, necessary for the fair presentation of the financial statements.
2 Management Fee and Other Transactions with Affiliates
-----------------------------------------------------------------------------
The management fee is earned by Eaton Vance Management (EVM) as compensation
for management and administration of the business affairs of the Fund. The
fee is based on a percentage of average daily net assets. For the six months
ended June 30, 1998, the fee was equivalent to 0.25% of the Fund's average
net assets for such period and amounted to $93,858. Except as to Trustees of
the Fund who are not members of EVM's organization, officers and Trustees
receive remuneration for their services to the Fund out of such management
fee. In addition, investment adviser and administrative fees are paid by the
Portfolio to EVM and its affiliates. See Note 2 of the Portfolio's Notes to
Financial Statements which are included elsewhere in this report.
Eaton Vance Distributors, Inc. (EVD), a subsidiary of EVM and the Funds'
principal underwriter, received $3,424 from the Eaton Vance Greater India
Fund as its portion of the sales charge on sales of Class A shares for the
six months ended June 30, 1998.
Certain officers and Trustees of the Fund and the Portfolio are officers and
directors of EVM.
3 Shares of Beneficial Interest
-----------------------------------------------------------------------------
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follow:
Six Months Ended
June 30, 1998
Class A (Unaudited)
-----------------------------------------------------------------------------
Sales 238,981
Redemptions (631,418)
Issued to EV Traditional Greater India
Fund shareholders 1,973,120
-----------------------------------------------------------------------------
Net increase 1,580,683
-----------------------------------------------------------------------------
Six Months Ended
June 30, 1998 Year Ended
Class B (Unaudited) December 31, 1997
-----------------------------------------------------------------------------
Sales 454,130 2,278,392
Redemptions (2,410,972) (3,854,049)
-----------------------------------------------------------------------------
Net decrease (1,956,842) (1,575,657)
-----------------------------------------------------------------------------
4 Distributions to Shareholders
-----------------------------------------------------------------------------
It is the present policy of the Fund to make (a) at least one distribution
annually (normally in December) of all or substantially all of the net
investment income allocated to the Fund by the Portfolio, if any, less the
Fund's direct expenses and (b) at least one distribution annually of all or
substantially all of the net realized capital gains allocated by the
Portfolio to the Fund, if any, (reduced by any available capital loss
carryforwards from prior years). Shareholders may reinvest all distributions
in shares of the Fund, without a sales charge, at the per share net asset
value as of the close of business on the ex-dividend date. The Fund
distinguishes between distributions on a tax basis and a financial reporting
basis. Generally accepted accounting principles require that only
distributions in excess of tax basis earnings and profits be reported in the
financial statements as a return of capital. Differences in the recognition
or classification of income between the
7
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
financial statement and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
losses. Permanent differences between book and tax accounting are
reclassified to paid-in capital.
5 Investment Transactions
-----------------------------------------------------------------------------
For the six months ended June 30, 1998, increases and decreases in the Fund's
investment in the Portfolio aggregated $3,833,346 and $20,091,041,
respectively.
6 Distribution Plan
-----------------------------------------------------------------------------
The Fund has adopted distribution plans (Class A Plan, Class B Plan, the
Plans) pursuant to Rule 12b-1 under the Investment Company Act of 1940.
The Class A Plan provides for the payment of a monthly distribution fee to
the Principal Underwriter, Eaton Vance Distributors, Inc. (EVD), in an amount
equal to the aggregate of (a) 0.50% of that portion of the Fund's average
daily net assets attributable to Class A shares which have remained
outstanding for less than one year and (b) 0.25% of that portion of the
Fund's average daily net assets attributable to Class A shares which have
remained outstanding for more than one year.
The Class B Plan provides for the payment of a monthly distribution fee to
EVD at an annual rate not to exceed 0.75% of the Fund's average daily net
assets attributable to Class B shares. The Fund will automatically
discontinue payments to EVD under the Class B Plan during any period in which
there are no outstanding Uncovered Distribution Charges, which are equivalent
to the sum of (i) 5% of the amount received by the Fund for each Class B
share sold plus, (ii) distribution fees calculated by applying the rate of 1%
over the prevailing prime rate to the outstanding balance of Uncovered
Distribution Charges of EVD reduced by the aggregate amount of contingent
deferred sales charges (See Note 7), daily amounts theretofore paid to EVD by
Lloyd George Investment Management (Bermuda) Limited, investment adviser for
the Portfolio (Adviser), in consideration of EVD's distribution effort. The
amount of Uncovered Distribution Charges EVD calculated under the Class B
Plan was approximately $3,201,000 at June 30, 1998. The amounts paid by the
Adviser to EVD are equivalent to 0.15% of the Fund's average net assets
attributable to Class B shares and are made from the Adviser's own resources,
not Fund assets.
Distribution fee payments are made for providing ongoing distribution
services to the Fund. The amount payable to EVD by the Fund with respect to
each day is accrued on such day as a liability of the Fund and, accordingly,
reduces the Fund's net assets. The Fund paid or accrued $18,411 and $237,884
for Class A and Class B shares, respectively, to or payable to EVD for the
six months ended June 30, 1998, representing 0.32% (annualized) and 0.75%
(annualized) of average daily net assets attributable to Class A and Class B
shares, respectively.
In addition, the Plans authorize the Fund to make payments of service fees to
EVD, Authorized Firms and other persons in an amount equal to 0.25%, on an
annual basis, of the Fund's average daily net assets attributable to Class A
shares which have remained outstanding for more than one year and in amounts
not exceeding 0.25% of the Fund's average daily net assets attributable to
Class B shares which have remained outstanding for more than one year. Such
payments are made for personal services and/or the maintenance of shareholder
accounts. Service fees are separate and distinct from the sales commissions
and distribution fees payable by the Fund to EVD and, as such, are not
subject to automatic discontinuance where there are no outstanding Uncovered
Distribution Charges of EVD. For the six months ended June 30, 1998, service
fees amounted to $10,717 and $75,800 for Class A and Class B shares,
respectively, representing 0.18% (annualized) and 0.24% (annualized) of
average daily net assets attributable to Class A and Class B shares,
respectively.
Certain officers and Trustees of the Fund are officers or directors of EVD.
7 Contingent Deferred Sales Charge
-----------------------------------------------------------------------------
A contingent deferred sales charge (CDSC) is imposed on any redemption of
Class B shares made within six years of purchase. Generally, the CDSC is
based upon the lower of the net asset value at date of redemption or date of
purchase. No charge is levied on shares acquired by reinvestment of dividends
or capital gains distributions. The CDSC is imposed at declining rates that
begin at 5% in the case of redemptions in the first and second year after
8
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
purchase, declining one percentage point each subsequent year. No CDSC is
levied on shares which have been sold to EVM or its affiliates or to their
respective employees or clients. CDSC charges are paid to EVD to reduce the
amount of Uncovered Distribution Charges calculated under the Fund's
Distribution Plan. CDSC charges received when no Uncovered Distribution
Charges exist will be credited to the Fund. For the six months ended June 30,
1998, EVD received approximately $415,000 of CDSC paid by Class B
shareholders.
8 Transfer of Net Assets
-----------------------------------------------------------------------------
On January 1, 1998, EV Marathon Greater India Fund acquired the net assets of
the EV Traditional Greater India Fund pursuant to an Agreement and Plan of
Reorganization dated June 23, 1997. In accordance with the agreement, EV
Marathon Greater India Fund, at the closing, issued 1,973,120 Class A shares
of the Fund having an aggregate value of $12,518,640. As a result the Fund
issued one Class A share for each share of EV Traditional Greater India Fund.
The transaction was structured for tax purposes to qualify as a tax-free
reorganization under the Internal Revenue Code. The EV Traditional Greater
India Fund's net assets at the date of the transaction were $12,518,640,
including $744,300 of unrealized appreciation. Directly after the merger, the
combined net assets of the Eaton Vance Greater India Fund (formerly "EV
Marathon Greater India Fund") were $81,331,134 with a net asset value of
$6.34 and $6.23 for Class A and Class B, respectively.
9 Name Change
-----------------------------------------------------------------------------
Effective January 1, 1998, the EV Marathon Greater India Fund changed its
name to the Eaton Vance Greater India Fund.
9
<PAGE>
South Asia Portfolio as of June 30, 1998
PORTFOLIO OF INVESTMENTS (Unaudited)
Common Stocks -- 92.4%
Bangladesh -- 0.3%
Shares Value
- --------------------------------------------------------------------------------
Textiles -- 0.3%
- --------------------------------------------------------------------------------
Apex Spinning & Knitting Mills 48,000 $ 161,210
Garment manufacturer.
- --------------------------------------------------------------------------------
$ 161,210
- --------------------------------------------------------------------------------
Total Bangladesh
(identified cost $311,535) $ 161,210
- --------------------------------------------------------------------------------
India -- 86.8%
Agricultural Equipment -- 4.5%
- --------------------------------------------------------------------------------
Punjab Tractors Ltd./(1)/ 138,900 $2,642,556
The only fully indigenously designed tractor
manufacturer in the country.
- --------------------------------------------------------------------------------
$2,642,556
- --------------------------------------------------------------------------------
Auto and Parts -- 4.1%
- --------------------------------------------------------------------------------
Bajaj Auto Ltd./(1)/ 130,000 $1,753,567
Leading manufacturer of two-wheelers
& three-wheelers.
IFB Industries Ltd./(1)/ 50 16
Manufacturer of high precision engineering tools
and domestic appliances.
Motor Industries 7,150 646,628
A subsidiary of Robert Bosch of Germany with
a presence in the auto components industry,
with products such as spark plugs & fuel
injection pumps.
- --------------------------------------------------------------------------------
$2,400,211
- --------------------------------------------------------------------------------
Banks and Money Services -- 1.6%
- --------------------------------------------------------------------------------
Industrial Credit and Investment Corp./(1)/ 500,550 $ 913,632
One of India's largest development finance
institutions, with assets over $7.39 billion,
involved in project financing &
investment banking.
Karur Vysya Bank/(1)/ 250 948
Private sector bank involved in
retail banking.
Kotak Mahindra Finance Ltd/(1)/ 1,400 769
Bill discounting & consumer financing.
Oriental Bank of Commerce/(1)/ 100 111
Public sector retail bank.
State Bank of India/(1)/ 670 $ 3,339
The largest public sector commercial bank in
India, with over 8000 branches. Engaged
in retail banking & a range of non-fund
based activities.
- --------------------------------------------------------------------------------
$ 918,799
- --------------------------------------------------------------------------------
Beverages -- 0.0%
- --------------------------------------------------------------------------------
Tata Tea Ltd./(1)/ 750 $ 5,363
Integrated tea company with substantial
presence in plantation as well as direct marketing
of branded tea.
- --------------------------------------------------------------------------------
$ 5,363
- --------------------------------------------------------------------------------
Building Materials -- 0.0%
- --------------------------------------------------------------------------------
Associated Cement Cos. Ltd./(1)/ 402 $ 11,566
India's largest & one of the world's largest
cement manufacturing companies; total capacity
of 9.96 million tons.
Murudeshwar Ceramics Ltd./(1)/ 7,800 938
Manufacturer of glazed ceramic wall and
floor tiles.
- --------------------------------------------------------------------------------
$ 12,504
- --------------------------------------------------------------------------------
Cable - Telecommunications -- 0.0%
- --------------------------------------------------------------------------------
Usha Beltron Ltd. GDR 290 $ 160
A medium-sized manufacturer of jelly filled
telecom cables.
- --------------------------------------------------------------------------------
$ 160
- --------------------------------------------------------------------------------
Chemicals -- 3.8%
- --------------------------------------------------------------------------------
Hoechst Schering Agrevo Ltd. 128,700 $2,245,914
A major company in the agrochemical &
pesticide business.
Reliance Industries Ltd./(1)/ 3,745 12,656
Integrated petrochemical company with world
size capacities and major presence in polyesters
and polymers.
Tata Chemicals/(1)/ 1,449 4,285
A diversified company with a major presence
in soda ash, caustic soda & fertilizers.
- --------------------------------------------------------------------------------
$2,262,855
- --------------------------------------------------------------------------------
See notes to financial statements
10
<PAGE>
South Asia Portfolio as of June 30, 1998
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Shares Value
- --------------------------------------------------------------------------------
Chemicals - Specialty -- 0.9%
- --------------------------------------------------------------------------------
ICI India Ltd. 108,800 $ 510,581
A 51% subsidiary of ICI PLC, UK, having
major presence in paints, explosives and
specialty chemicals
- --------------------------------------------------------------------------------
$ 510,581
- --------------------------------------------------------------------------------
Computer Software -- 18.5%
- --------------------------------------------------------------------------------
Cybertech Systems and Software Ltd. 50,000 $ 307,157
Specializes in providing training to professionals
in SAP, an enterprise resource planning
(ERP) package.
Digital Equipments (India) Ltd. 250,000 785,874
A total solutions provider in the information
technology industry, with major revenues from
sales of Intel based systems and high end
proprietary Alpha products. Software exports
& systems integration are other major areas
of business.
Infosys Technologies Ltd. 143,700 7,532,346
One of India's leading companies in the
computer software sector. Provides specialized
software for banking & retail distribution sector -
major clients include Reebok and Levi Straus.
NIIT Ltd. 55,000 1,842,412
India's leading information technology education
company and the third largest exporter
of software.
Tata Infotech Ltd./(1)/ 12,400 386,650
One of the largest information technology service
& solution providers in India with interest in
software development, distribution, networking,
maintenance, support and training.
- --------------------------------------------------------------------------------
$10,854,439
- --------------------------------------------------------------------------------
Conglomerates -- 1.2%
- --------------------------------------------------------------------------------
Indian Rayon & Industries Ltd./(1)/ 448 $ 2,166
Diversified company with interests in cement,
textiles, rayon and carbon black
Ramco Industries Ltd. 52,300 599,467
Ramco Industries Ltd. 11,000 126,083
Diversified company with interests in building
materials, textiles and computer software.
- --------------------------------------------------------------------------------
$ 727,716
- --------------------------------------------------------------------------------
Consumer Products -- 7.1%
- --------------------------------------------------------------------------------
ITC Ltd. 188,600 $ 2,899,828
Manufacturer of
cigarettes/tobacco with market
leadership in all cigarette segments.
Marico Industries Ltd. 99,200 561,443
A consumer product company, with presence in
coconut/edible oil and hair care oil.
Ponds (India) Ltd./(1)/ 27,900 697,418
51% subsidiary of Unilever PLC, UK (to be
merged with another giant Unilever company in
India - Hindustand Lever) has presence in
personal care products.
- --------------------------------------------------------------------------------
$ 4,158,689
- --------------------------------------------------------------------------------
Diversified Industry -- 2.4%
- --------------------------------------------------------------------------------
Enkay Texofood Industries Ltd./(1)/ 786 $ 473
Has business interests in the manufacturing of
synthetic yarns & the export of processed foods.
Larsen & Toubro Ltd./(1)/ 480 2,596
India's largest company in the engineering &
construction sector.
Larsen & Toubro Ltd. GDR 155,000 1,406,625
Diversified conglomerate with interests in the
manufacturing of cement, electrical &
electronics, as well as the undertaking of
turnkey projects in infrastructure.
Thiru Arooran Sugars/(1)/ 500 637
A manufacturer of sugar & industrial alcohol
Has also made foray into cogeneration of power
through bagasse.
- --------------------------------------------------------------------------------
$1,410,331
- --------------------------------------------------------------------------------
Electric Utilities -- 2.5%
- --------------------------------------------------------------------------------
BSES Ltd./(1)/ 401,088 $1,475,527
A monopoly distributor of power in suburbs
of Bombay.
- --------------------------------------------------------------------------------
$1,475,527
- --------------------------------------------------------------------------------
Electrical Equipment -- 0.0%
- --------------------------------------------------------------------------------
Asea Brown Boveri (India) Ltd./(1)/ 1,950 $ 19,555
Indian subsidiary of Swedish-Swiss multinational
ABB & one of the largest manufacturers of
electrical power equipment.
- --------------------------------------------------------------------------------
$ 19,555
- --------------------------------------------------------------------------------
See notes to financial statements
11
<PAGE>
South Asia Portfolio as of June 30, 1998
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Shares Value
- --------------------------------------------------------------------------------
Household Products -- 17.0%
- --------------------------------------------------------------------------------
Hindustan Lever Ltd./(1)/ 280,250 $ 9,976,119
A diversified multinational of the Unilever group
and a market leader in soap & detergents,
personal care & food processing industries.
Reckitt and Colman of India Ltd./(1)/ 4,000 27,119
Manufacturer of household products such as
mosquito repellent, surface cleaning agents and
antiseptic lotions.
- --------------------------------------------------------------------------------
$10,003,238
- --------------------------------------------------------------------------------
Industrial Equipment -- 0.0%
- --------------------------------------------------------------------------------
Thermax Ltd. 1,800 $ 5,590
Diversified company with three major divisions -
energy, environment & chemicals, manufacturing
industrial boilers, process heat equipment &
chillers, and pollution control equipment.
Triveni Engineering 33 33
Manufacturer of sugar, sugar machinery
& turbines.
- --------------------------------------------------------------------------------
$ 5,623
- --------------------------------------------------------------------------------
Lodging and Gaming -- 0.0%
- --------------------------------------------------------------------------------
Hotel Leela Venture Ltd./(1)/ 750 $ 785
Operates business hotels & a beach resort in
Bombay & Goa, respectively.
- --------------------------------------------------------------------------------
$ 785
- --------------------------------------------------------------------------------
Machinery -- 1.3%
- --------------------------------------------------------------------------------
Ingersoll Rand of India 61,400 $ 531,033
Manufacturer of compressors, process pumps and
mining equipment.
Otis Elevator Co. (India) Ltd. 41,100 257,814
Manufacturer of elevators and escalators with
dominant market share.
- --------------------------------------------------------------------------------
$ 788,847
- --------------------------------------------------------------------------------
Medical Products -- 8.6%
- --------------------------------------------------------------------------------
Cipla Ltd./(1)/ 50 $ 815
Market leader in anti-bacterial, anti-asthmatic,
and anti-cancer products and entering into
segments of cardiovascular and dermatology.
Hoechst Marion Roussel Ltd. 382,000 3,567,315
The fourth largest company in the Indian
pharmaceutical industry with major presence in
therapeutical segments of analgesic, antihistemic,
cardiovascular drugs. Also manufactures animal
health care.
Ranbaxy Laboratories Ltd./(1)/ 115,928 1,496,771
Presence in anti-bacterial and antibiotics
segments, and a major exporter of bulk drugs
and formulations.
- --------------------------------------------------------------------------------
$ 5,064,901
- --------------------------------------------------------------------------------
Metals - Industrial -- 0.0%
- --------------------------------------------------------------------------------
Bellary Steels & Alloys/(1)/ 400 $ 94
An integrated private sector steel company
with capacity slated to increase from 0.5 to 2
million tons.
Essar Steel Ltd./(1)/ 100 38
Manufacturer of sponge iron & hot rolled coils.
Tata Iron & Steel Co. Ltd./(1)/ 203 603
The largest private sector integrated steel
manufacturer in the country, with a total capacity
of 2.7 million tons.
- --------------------------------------------------------------------------------
$ 735
- --------------------------------------------------------------------------------
Oil and Gas - Equipment and Services -- 1.0%
- --------------------------------------------------------------------------------
Hi-tech Drilling Services India Ltd./(1)/ 285,000 $ 560,860
A company engaged in offshore oil drilling.
- --------------------------------------------------------------------------------
$ 560,860
- --------------------------------------------------------------------------------
Oil and Gas - Exploration
and Production -- 5.3%
- --------------------------------------------------------------------------------
Hindustan Petroleum Corp./(1)/ 340,900 $ 3,139,287
Petroleum company with the second largest
10.25 MMT refining capacity in the country with
strong marketing network.
- --------------------------------------------------------------------------------
$ 3,139,287
- --------------------------------------------------------------------------------
Packaging -- 0.0%
- --------------------------------------------------------------------------------
Flex Industries (wts)/(2)/ 4,274 $ 247
Leading integrated company in the
packaging industry.
- --------------------------------------------------------------------------------
$ 247
- --------------------------------------------------------------------------------
See notes to financial statements
12
<PAGE>
South Asia Portfolio as of June 30, 1998
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Shares Value
- --------------------------------------------------------------------------------
Paper and Forest Products -- 0.0%
- --------------------------------------------------------------------------------
Tamil Nadu Newsprint and Paper/(1)/ 300 $ 123
The world's largest begasse based paper
manufacturer in the public sector.
- --------------------------------------------------------------------------------
$ 123
- --------------------------------------------------------------------------------
Telecommunications -- 5.4%
- --------------------------------------------------------------------------------
Mahanger Telephone Nigam Ltd./(1)/ 366,500 $ 1,541,884
Government owned monopoly provider of fixed
wire telephone services in India's major cities of
Bombay & Delhi.
Videsh Sanchar Nigam Ltd., GDR 150,000 1,605,000
India's monopoly international telephone
service provider.
- --------------------------------------------------------------------------------
$ 3,146,884
- --------------------------------------------------------------------------------
Transportation -- 1.6%
- --------------------------------------------------------------------------------
Great Eastern Shipping/(1)/ 1,270,100 $ 925,506
Diversified company with interests in shipping
and property development.
- --------------------------------------------------------------------------------
$ 925,506
- --------------------------------------------------------------------------------
Total India
(identified cost $47,539,977) $51,036,322
- --------------------------------------------------------------------------------
Pakistan -- 4.0%
Electric Utilities -- 0.0%
- --------------------------------------------------------------------------------
Karachi Electric Supply Co./(1)/ 50 $ 9
Electric distributor for Karachi.
- --------------------------------------------------------------------------------
$ 9
- --------------------------------------------------------------------------------
Household Products -- 3.9%
- --------------------------------------------------------------------------------
Lever Brothers Pakistan Ltd. 120,000 $ 2,261,794
Leading manufacturer and retailer of
consumer products.
- --------------------------------------------------------------------------------
$ 2,261,794
- --------------------------------------------------------------------------------
Insurance -- 0.0%
- --------------------------------------------------------------------------------
Adamjee Insurance Co./(1)/ 1 $ 1
Leading supplier of general insurance in Pakistan.
- --------------------------------------------------------------------------------
$ 1
- --------------------------------------------------------------------------------
Medical Products -- 0.0%
- --------------------------------------------------------------------------------
Searle Pakistan 23,711 $ 7,071
Major player in the pharmaceutical industry.
- --------------------------------------------------------------------------------
$ 7,071
- --------------------------------------------------------------------------------
Oil and Gas - Equipment and Services -- 0.1%
- --------------------------------------------------------------------------------
Pakistan State Oil Co. Ltd. 48,744 $ 78,182
Principal distributor of fuel, oil and petroleum.
- --------------------------------------------------------------------------------
$ 78,182
- --------------------------------------------------------------------------------
Total Pakistan
(identified cost $2,728,859) $ 2,347,057
- --------------------------------------------------------------------------------
Sri Lanka -- 1.3%
Banks and Money Services -- 0.4%
- --------------------------------------------------------------------------------
Development Finance Corp. 2 $ 5
One of Sri Lanka's largest development financial
institutions involved in project financing &
investment banking.
National Development Bank 135,600 259,174
A premier development financial institution
involved in project financing, merchant banking &
commercial leasing.
- --------------------------------------------------------------------------------
$ 259,179
- --------------------------------------------------------------------------------
Conglomerates -- 0.9%
- --------------------------------------------------------------------------------
Hayleys Ltd. 1 $ 3
Has interest in diversified business of shipping,
agriculture, textiles & hotels.
John Keells Holdings GDR 94,795 521,373
A diversified conglomerate operating in tourism,
food & beverages, property development sectors.
- --------------------------------------------------------------------------------
$ 521,376
- --------------------------------------------------------------------------------
Total Sri Lanka
(identified cost $1,138,562) $ 780,555
- --------------------------------------------------------------------------------
Total Common Stocks
(identified cost $51,718,933) $54,325,144
- --------------------------------------------------------------------------------
See notes to financial statements
13
<PAGE>
South Asia Portfolio as of June 30, 1998
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Bonds -- 0.0%
Principal
Amount
(000's omitted) Value
- --------------------------------------------------------------------------------
Flex Industries, 13.50%, 12/31/99 $ 812 $ 13,707
Hotel Leela Venture Ltd. NCD,
14.00%, 4/8/03 15 325
- --------------------------------------------------------------------------------
Total Bonds
(identified cost $26,599) $ 14,032
- --------------------------------------------------------------------------------
Total Investments -- 92.4%
(identified cost $51,745,532) $54,339,176
- --------------------------------------------------------------------------------
Other Assets, Less Liabilities -- 7.6% $ 4,474,685
- --------------------------------------------------------------------------------
Net Assets -- 100% $58,813,861
- --------------------------------------------------------------------------------
GDR -- Global Depositary Receipt
/(1)/ The above securities held by the Portfolio on June 30, 1998 are
unrestricted securities valued at market prices. Because of the length of
the registration process, the Portfolio would temporarily be unable to
sell certain of these securities. At June 30, 1998, the aggregate value of
these securities amounted to $4,725,013 representing 8.0% of the
Portfolio's net assets (Note 5).
/(2)/ Security valued at fair value using methods determined in good faith by or
at the direction of the Trustees.
See notes to financial statements
14
<PAGE>
South Asia Portfolio as of June 30, 1998
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
<TABLE>
<CAPTION>
Top Ten Holdings Industry concentration -- Below are the
top ten industry sectors represented in the
Portfolio of Investments
Percentage Percentage
Industry of Net of Net
Company Sector Assets Value Industry Sector Assets Value
- ----------------------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Hindustan Lever Ltd. Household Products 17.0% $9,976,119 Household Products 20.9% $12,265,032
Infosys Technologies Ltd. Computer Software 12.8 7,532,346 Computer Software 18.5 10,854,439
Hoechst Marion Roussel Ltd. Medical Products 6.1 3,567,315 Medical Products 8.6 5,071,972
Hindustan Petroleum Corp. Oil and Gas - Exploration 5.3 3,139,287 Consumer Products 7.1 4,158,689
and Production Telecommunications 5.4 3,146,884
ITC Ltd. Consumer Products 4.9 2,899,828 Oil and Gas - Exploration and
Production 5.3 3,139,287
Punjab Tractors Ltd. Agricultural Equipment 4.5 2,642,556 Agricultural Equipment 4.5 2,642,556
Lever Brothers Pakistan Ltd. Household Products 3.8 2,261,794 Auto and Parts 4.1 2,400,211
Hoechst Schering Agrevo Ltd. Chemicals 3.8 2,245,914 Chemicals 3.8 2,262,855
NIIT Ltd. Computer Software 3.1 1,842,412 Electric Utilities 2.5 1,475,536
Bajaj Auto Ltd. Auto and Parts 3.0 1,753,567
</TABLE>
See notes to financial statements
15
<PAGE>
South Asia Portfolio as of June 30, 1998
FINANCIAL STATEMENTS (Unaudited)
Statement of Assets and Liabilities
As of June 30, 1998
Assets
- --------------------------------------------------------------------------------
Investments, at value
(identified cost, $51,745,532) $ 54,339,176
Cash 3,339,561
Foreign currency, at value
(identified cost, $1,036,536) 1,039,511
Receivable for investments sold 419,075
Dividends and interest receivable 271,290
Miscellaneous receivable 82
Tax reclaim receivable 2,593
Deferred organization expenses 14,218
- --------------------------------------------------------------------------------
Total assets $ 59,425,506
- --------------------------------------------------------------------------------
Liabilities
- --------------------------------------------------------------------------------
Payable for investments purchased $ 260,348
Payable to affiliate for Trustees' fees 1,758
Other accrued expenses 349,539
- --------------------------------------------------------------------------------
Total liabilities $ 611,645
- --------------------------------------------------------------------------------
Net Assets applicable to investors' interest in Portfolio $ 58,813,861
- --------------------------------------------------------------------------------
Sources of Net Assets
- --------------------------------------------------------------------------------
Net proceeds from capital contributions and withdrawals $ 56,239,408
Net unrealized appreciation (computed on the basis of
identified cost) 2,574,453
- --------------------------------------------------------------------------------
Total $ 58,813,861
- --------------------------------------------------------------------------------
Statement of Operations
For the Six Months
Ended June 30, 1998
Investment Income
- --------------------------------------------------------------------------------
Dividends (net of foreign taxes, $5,693) $ 732,589
- --------------------------------------------------------------------------------
Total investment income $ 732,589
- --------------------------------------------------------------------------------
Expenses
- --------------------------------------------------------------------------------
Investment adviser fee $ 291,209
Administration fee 97,070
Trustees fees and expenses 4,839
Custodian fee 262,785
Legal and accounting services 64,300
Amortization of organization expenses 8,630
Miscellaneous 62,222
- --------------------------------------------------------------------------------
Total expenses $ 791,055
- --------------------------------------------------------------------------------
Deduct --
Reduction of custodian fee $ 32,966
- --------------------------------------------------------------------------------
Total expense reductions $ 32,966
- --------------------------------------------------------------------------------
Net expenses $ 758,089
- --------------------------------------------------------------------------------
Net investment loss $ (25,500)
- --------------------------------------------------------------------------------
Realized and Unrealized
Gain (Loss)
- --------------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified cost basis) $ (9,730,221)
Foreign currency transactions (243,010)
- --------------------------------------------------------------------------------
Net realized loss $ (9,973,231)
- --------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments (identified cost basis) $ 1,339,336
Foreign currency (5,172)
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) $ 1,334,164
- --------------------------------------------------------------------------------
Net realized and unrealized loss $ (8,639,067)
- --------------------------------------------------------------------------------
Net decrease in net assets from operations $ (8,664,567)
- --------------------------------------------------------------------------------
See notes to financial statements
16
<PAGE>
South Asia Portfolio as of June 30, 1998
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
Six Months Ended
Increase (Decrease) June 30, 1998 Year Ended
in Net Assets (Unaudited) December 31, 1997
- --------------------------------------------------------------------------------
From operations --
Net investment loss $ (25,500) $ (222,946)
Net realized loss (9,973,231) (6,059,884)
Net change in unrealized
appreciation (depreciation) 1,334,164 15,208,670
- --------------------------------------------------------------------------------
Net increase (decrease) in net assets
from operations $ (8,664,567) $ 8,925,840
- --------------------------------------------------------------------------------
Capital transactions --
Contributions $ 3,891,327 $ 42,091,228
Withdrawals (20,587,648) (70,765,712)
- --------------------------------------------------------------------------------
Net decrease in net assets from
capital transactions $ (16,696,321) $ (28,674,484)
- --------------------------------------------------------------------------------
Net decrease in net assets $ (25,360,888) $ (19,748,644)
- --------------------------------------------------------------------------------
Net Assets
- --------------------------------------------------------------------------------
At beginning of period $ 84,174,749 $ 103,923,393
- --------------------------------------------------------------------------------
At end of period $ 58,813,861 $ 84,174,749
- --------------------------------------------------------------------------------
Statement of Cash Flows
Six Months Ended
June 30,1998
Increase (Decrease) in Cash (Unaudited)
- --------------------------------------------------------------------------------
Cash Flows From (For) Operating Activities --
Purchase of investments $(23,382,999)
Proceeds from sale of investments 37,285,910
Dividends, interest and tax reclaims received 599,634
Operating expenses paid (635,518)
Foreign currency transactions 4,397,010
- --------------------------------------------------------------------------------
Net cash from operating activities $ 18,264,037
- --------------------------------------------------------------------------------
Cash Flows From (For) Financing Activities --
Proceeds from capital contributions $ 3,891,327
Payments for capital withdrawals (20,587,648)
- --------------------------------------------------------------------------------
Net cash used for financing activities $(16,696,321)
- --------------------------------------------------------------------------------
Net increase in cash $ 1,567,716
- --------------------------------------------------------------------------------
Cash at Beginning of Period $ 1,771,845
- --------------------------------------------------------------------------------
Cash at End of Period $ 3,339,561
- --------------------------------------------------------------------------------
Reconciliation of Net Decrease in Net Assets
From Operations to Net Cash From
Operating Activities
- --------------------------------------------------------------------------------
Net decrease in net assets from operations $ (8,664,567)
Decrease in receivable for investments sold 1,402,045
Decrease in foreign currency 4,645,192
Increase in dividends, interest and other receivables (132,955)
Decrease in deferred organizational expense 8,630
Increase in payable for investments purchased 259,346
Increase in payable to affiliate 445
Increase in accrued expenses and other liabilities 113,496
Net decrease in investments 20,632,405
- --------------------------------------------------------------------------------
Net cash from operating activities $ 18,264,037
- --------------------------------------------------------------------------------
See notes to financial statements
17
<PAGE>
South Asia Portfolio as of June 30, 1998
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Six Months Ended Year Ended December 31,
June 30, 1998 -----------------------------------------------------
(Unaudited) 1997 1996 1995 1994*
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average daily net assets
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Expenses /(1)/ 2.04%+ 1.61% 1.51% 1.76% 1.16%+
Expenses after custodian fee reduction /(1)/ 1.96%+ 1.58% 1.28% 1.35% --
Net investment income (loss) (0.07)%+ (0.20)% (0.11)% (0.18)% 0.01%+
Portfolio Turnover 33% 48% 46% 38% 1%
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized.
* For the period from the start of business, May 2, 1994, to December 31,
1994.
/(1)/ The expense ratios for the year ended December 31, 1995 and periods
thereafter have been adjusted to reflect a change in reporting
requirements. The new reporting guidelines require the Portfolio to
increase its expense ratio by the effect of any expense offset
arrangements with its service providers. The expense ratio for the period
ended December 31, 1994 has not been adjusted to reflect this change.
See notes to financial statements
18
<PAGE>
South Asia Portfolio as of June 30, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1 Significant Accounting Policies
----------------------------------------------------------------------------
South Asia Portfolio (the "Portfolio") is registered under the Investment
Company Act of 1940 as a diversified, open-end management investment company
which was organized as a trust under the laws of the State of New York on
January 18, 1994. The Declaration of Trust permits the Trustees to issue
interests in the Portfolio. The following is a summary of the significant
accounting policies of the Portfolio. The policies are in conformity with
generally accepted accounting principles.
A Investment Valuations -- Marketable securities, including options, that
are listed on foreign or U.S. securities exchanges or in the NASDAQ National
Market System are valued at closing sale prices or, if there were no sales,
at the mean between the closing bid and asked prices on the exchange where
such securities are principally traded. Futures positions on securities or
currencies are generally valued at closing settlement prices. Unlisted or
listed securities for which closing sale prices are not available are valued
at the mean between the latest bid and asked prices. Short term debt
securities with a remaining maturity of 60 days or less are valued at
amortized cost. Other fixed income and debt securities, including listed
securities and securities for which price quotations are available, will
normally be valued on the basis of valuations furnished by a pricing
service. Investments for which valuations or market quotations are
unavailable are valued at fair value using methods determined in good faith
by or at the direction of the Trustees.
B Federal Taxes -- The Portfolio is treated as a partnership for U.S.
Federal tax purposes. No provision is made by the Portfolio for federal or
state taxes on any taxable income of the Portfolio because each investor in
the Portfolio is individually responsible for the payment of any taxes on
its share of such income. Since some of the Portfolio's investors are
regulated investment companies that invest all or substantially all of their
assets in the Portfolio, the Portfolio normally must satisfy the applicable
source of income and diversification requirements, (under the U.S. Internal
Revenue Code), in order for its investors to satisfy them. The Portfolio
will allocate, at least annually among its investors, each investor's
distributive share of the Portfolio's net investment income, net realized
capital gains, and any other items of income, gain, loss, deduction or
credit.
C Deferred Organization Expenses -- Costs incurred by the Portfolio in
connection with its organization, including registration costs, are being
amortized on a straight-line basis over five years.
D Financial Futures Contracts -- Upon the entering of a financial futures
contract, the Portfolio is required to deposit ("initial margin") either
cash or securities in an amount equal to a certain percentage of the
purchase price indicated in the financial futures contract. Subsequent
payments are made or received by the Portfolio ("margin maintenance") each
day, dependent on daily fluctuations in the value of the underlying
security, and are recorded for book purposes as unrealized gains or losses
by the Portfolio. Should interest or currency exchange rates move
unexpectedly, the Portfolio may not achieve the anticipated benefits of the
financial futures contracts and may realize a loss. If the Portfolio enters
into a closing transaction, the Portfolio will realize, for book purposes, a
gain or loss equal to the difference between the value of the financial
futures contract to sell and financial futures contract to buy.
E Foreign Currency Translation -- Investment valuations, other assets, and
liabilities initially expressed in foreign currencies are converted each
business day into U.S. dollars based upon current exchange rates. Purchases
and sales of foreign investment securities and income and expenses are
converted into U.S. dollars based upon currency exchange rates prevailing on
the respective dates of such transactions. Recognized gains or losses on
investment transactions attributable to foreign currency rates are recorded
for financial statement purposes as net realized gains and losses on
investments. That portion of unrealized gains and losses on investments that
result from fluctuations in foreign currency exchange rates are not
separately disclosed.
F Forward Foreign Currency Exchange
Contracts -- The Portfolio may enter into forward foreign currency exchange
contracts for the purchase or sale of a specific foreign currency at a fixed
price on a future date. Risks may arise upon entering these contracts from
the potential inability of counterparties to meet the terms of their
contracts and from movements in the value of a foreign currency relative to
the U.S. dollar. The Portfolio will enter into forward contracts for hedging
purposes. The forward foreign currency exchange contracts are adjusted by
the daily exchange rate of the underlying currency and any gains or losses
are recorded for financial statement purposes as unrealized until such time
as the contracts have been closed or offset.
19
<PAGE>
South Asia Portfolio as of June 30, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
G Expense Reduction -- Investors Bank & Trust Company (IBT) serves as
custodian of the Portfolio. Pursuant to the custodian agreement, IBT
receives a fee reduced by credits which are determined based on the average
daily cash balances the Portfolio maintains with IBT. All significant credit
balances used to reduce the Portfolio's custodian fees are reported as a
reduction of expenses in the Statement of Operations.
H Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of revenue and expense during the reporting period. Actual results could
differ from those estimates.
I Other -- Investment transactions are accounted for on the date the
securities are purchased or sold. Dividend income is recorded on the
ex-dividend date. However, if the ex-dividend date has passed, certain
dividends from foreign securities are recorded as the Portfolio is informed
of the ex-dividend date. Interest income is recorded on the accrual basis.
J Interim Financial Statements -- The interim financial statements relating
to June 30, 1998 and for the six months then ended have not been audited by
independent certified public accountants, but in the opinion of the Fund's
management, reflect all adjustments, consisting only of normal recurring
adjustments, necessary for the fair presentation of the financial
statements.
2 Investment Adviser Fee and Other Transactions
with Affiliates
----------------------------------------------------------------------------
The investment adviser fee is earned by Lloyd George Investment Management
(Bermuda) Limited (the Adviser) as compensation for management and
investment advisory services rendered to the Portfolio. Under the advisory
agreement, the Adviser receives a monthly fee of 0.0625% (0.75% annually) of
the average daily net assets of the Portfolio up to $500,000,000, and at
reduced rates as daily net assets exceed that level. For the six months
ended June 30, 1998, the annualized adviser fee was 0.75% of average daily
net assets and amounted to $291,209. In addition, an administration fee is
earned by Eaton Vance Management (EVM) for managing and administering the
business affairs of the Portfolio. Under the administration agreement, EVM
earns a monthly fee in the amount of 1/48th of 1% (equal to 0.25% annually)
of the average daily net assets of the Portfolio up to $500,000,000, and at
reduced rates as daily net assets exceed that level. For the six months
ended June 30, 1998, the administration fee was 0.25% of average net assets
and amounted to $97,070. Except as to Trustees of the Portfolio who are not
members of the Adviser or EVM's organization, officers and Trustees receive
remuneration for their services to the Portfolio out of such investment
adviser and administrative fees. Certain of the officers and Trustees of the
Portfolio are officers or trustees of the above organizations.
3 Investment Transactions
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For the six months ended June 30, 1998, purchases and sales of investments,
other than short-term obligations, aggregated $23,642,345 and $35,883,865
respectively.
4 Federal Income Tax Basis of Investments
----------------------------------------------------------------------------
The cost and unrealized appreciation (depreciation) in value of the
investments owned at June 30, 1998, as computed on a federal income tax
basis, are as follows:
Aggregate cost $ 51,745,532
----------------------------------------------------------------------------
Gross unrealized appreciation $ 12,599,035
Gross unrealized depreciation (10,005,391)
----------------------------------------------------------------------------
Net unrealized appreciation $ 2,593,644
----------------------------------------------------------------------------
5 Risks Associated with Foreign Investments
----------------------------------------------------------------------------
Investing in securities issued by companies whose principal business
activities are outside the United States may involve significant risks not
present in domestic investments. For example, there is generally less
publicly available information about foreign companies, particularly those
not subject to the disclosure and reporting requirements of the U.S.
securities laws. Foreign issuers are generally not bound by uniform
accounting, auditing, and financial reporting requirements and standards of
practice comparable to those applicable to domestic issuers. Investments in
foreign securities also involve the risk of possible adverse changes in
investment or exchange control regulations, expropriation or confiscatory
taxation, limitation on the removal of funds or other assets of the
20
<PAGE>
South Asia Portfolio as of June 30, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
Portfolio, political or financial instability or diplomatic and other
developments which could affect such investments. Foreign stock markets,
while growing in volume and sophistication, are generally not as developed
as those in the United States, and securities of some foreign issuers
(particularly those located in developing countries) may be less liquid and
more volatile than securities of comparable U.S. companies. In general,
there is less overall governmental supervision and regulation of foreign
securities markets, broker-dealers, and issuers than in the United States.
Settlement of securities transactions in the Indian subcontinent may be
delayed and is generally less frequent than in the United States, which
could affect the liquidity of the Portfolio's assets. The Portfolio may be
unable to sell securities where the registration process is incomplete and
may experience delays in receipt of dividends.
6 Line of Credit
----------------------------------------------------------------------------
The Portfolio participates with other portfolios and funds managed by EVM
and its affiliates in a committed $100 million unsecured line of credit
agreement with a group of banks. The Portfolio may temporarily borrow from
the line of credit to satisfy redemption requests or settle investment
transactions. Interest is charged to each portfolio or fund based on its
borrowings at an amount above the eurodollar rate or federal funds rate. In
addition, a fee computed at an annual rate of 0.10% on the daily unused
portion of the line of credit is allocated among the participating
portfolios and funds at the end of each quarter. The Portfolio did not have
any significant borrowings or allocated fees during the six months ended
June 30, 1998.
21
<PAGE>
Eaton Vance Greater India Fund as of June 30, 1998
INVESTMENT MANAGEMENT
<TABLE>
<CAPTION>
Eaton Vance Greater India Fund
<S> <C>
Officers Trustees
James B. Hawkes M. Dozier Gardner
President and Trustee Vice Chairman, Eaton Vance Management
Edward E. Smiley, Jr. Donald R. Dwight
Vice President President, Dwight Partners, Inc.
James L. O'Connor Samuel L. Hayes, III
Treasurer Jacob H. Schiff Professor of Investment
Banking, Harvard University Graduate School of
Alan R. Dynner Business Administration
Secretary
Norton H. Reamer
Chairman and Chief Executive Officer, United Asset
Management Corporation
John L. Thorndike
Former Director, Fiduciary Company Incorporated
Jack L. Treynor
Investment Adviser and Consultant
<CAPTION>
South Asia Portfolio
<S> <C>
Officers Trustees
Hon. Robert Lloyd George Hon. Edward K.Y. Chen
President and Trustee Professor and Director, Center for Asian Studies,
University of Hong Kong
James B. Hawkes
Vice President and Trustee Donald R. Dwight
President, Dwight Partners, Inc.
Scobie Dickinson Ward
Vice President, Assistant Samuel L. Hayes, III
Secretary and Jacob H. Schiff Professor of Investment
Assistant Treasurer Banking, Harvard University Graduate School of
Business Administration
William Walter Raleigh Kerr
Vice President and Norton H. Reamer
Assistant Treasurer Chairman and Chief Executive Officer, United Asset
Management Corporation
James L. O'Connor
Vice President and Treasurer
Alan R. Dynner
Secretary
</TABLE>
22
<PAGE>
This Page Intentionally Left Blank
<PAGE>
Sponsor and Manager of
Eaton Vance Greater India Fund
Administrator of South Asia Portfolio
Eaton Vance Management
24 Federal Street
Boston, MA 02110
Advisor of South Asia Portfolio
Lloyd George Management
(Bermuda) Limited
3808 One Exchange Square
Central, Hong Kong
Principal Underwriter
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
Custodian
Investors Bank & Trust Company
200 Clarendon Street, 16th Floor
Boston, MA 02116
Transfer Agent
First Data Investor Services Group
Attention: Eaton Vance Funds
P.O. Box 5123
Westborough, MA 01581-5123
Eaton Vance Greater India Fund
24 Federal Street
Boston, MA 02110
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This report must be preceded or accompanied by a current prospectus which
contains more complete information on the Fund, including its sales charges and
expenses. Please read the prospectus carefully before you invest or send money.
- --------------------------------------------------------------------------------
GISRC-8/98
