India is exploring a large, multi-billion dollar sovereign wealth fund, potentially named the 'Bharat Sovereign Wealth Fund,' to create a permanent, non-tax revenue stream.
India Weighs $50 Billion 'Bharat Sovereign Wealth Fund' for Global Strategic Investments. (Image Source: Freepik)
The government has started examining the feasibility of establishing a large sovereign wealth fund (SWF) for India. The idea is to create a robust and permanent stream of revenue to the exchequer other than tax receipts, by way of returns from SWF’s diversified investments abroad.
Though the discussions are at an early stage, there is consensus that in order to serve the purpose, the initial size of such a fund could be in the region of $50 billion at least.
An SFW invests in strategic sectors, domestically and globally to secure the host country’s national interests and support economic growth. India being a fiscally constrained country with multiple development challenges, the SWF would also help generate resources for socio-economic programmes on a sustained basis, people aware of the matter told FE. An idea has been floated to create a ‘Bharat Sovereign Wealth Fund’ to invest in energy, critical mineral assets, technology and other sectors, which can generate returns as a business entity, they added.
There are many shining examples of SWFs in the world, especially among rich and fiscally strong countries, and their number has been on the rise. Apart from natural resources-rich countries like the UAE, Saudi Arabia and Kuwait and high per-capita income countries like Norway, even the city state of Singapore, because of its status as a global finance centre has developed sovereign funds of mammoth sizes. China too has multiple stat-owed funds which give a fillip to strategic overseas investments.
A decade ago, India set up a National Investment and Infrastructure Fund Limited (NIIFL) in the form of an alternative investment fund designed to catalyse capital flows into the country, with an initial corpus of ₹20,000 crore from the Government of India, whose holding is 49%. However, its size is not anywhere near the large SWFs of the world – the UAE’s SWFs, for instance, manage assets worth $2.3 trillion, and Singapore and Norway counterparts too have assets in excess of $2 trillion each.
An idea has been floated to create a ‘Bharat Sovereign Wealth Fund’ to invest in energy, critical mineral assets, technology and other sectors, which can generate returns as a business entity like Singapore SWF Temasek, people aware of the matter told FE.
The initial discussion on India’s SWF has seen some resistance within the bureaucracy, but the course to be taken will evolve over a period of time after the potential structure is crystallised after discussions, the sources reckon. An SWF ideally should be led by top executives drawn from the private sector to make it succeed, and not by career bureaucrats, the sources feel.
“Availability of resources won’t be an issue for the SWF, nor the talent required to lead it,” an official said, adding that for it to succeed, enough autonomy has to be given to the board to function efficiently.
Resources could be found by plugging leakages in government programmes, shutting down programmes that have lost relevance, and monetising assets, among others. India should start with at least $50 billion for its SWF to make any meaningful difference in the scheme of things, officials said.
The SWF could be a powerful tool to project India’s soft power as it becomes the third-largest nation in a couple of years and envisions being a developed nation by 2047.
Singapore’s Temasek was initially created to manage the country’s investments in state-owned enterprises. Over the decades, it has evolved into a global investor, focusing on long-term value creation across sectors like financial services, technology, telecommunications, life sciences, and consumer goods.
Temasek’s compounded Total Shareholder Return (TSR) since inception in 1974, exceeds 14% annualised, turning an initial S$354 million (US$273 million) portfolio into today’s S$434 billion (US$335 billion). TSR captures portfolio gains, dividends, and other distributions to its shareholders. Up to 50% of Temasek’s long-term expected returns fund the country’s national budget.
As of October 2025, there are over 90 SWFs globally, managing a collective $13.7 trillion in assets under management (AUM), according to the International Forum of Sovereign Wealth Funds and the Sovereign Wealth Fund Institute (SWFI). Some of the largest SWFs include Norway’s Government Pension Fund Global ($1.78 trillion), China Investment Corporation ($1.35 trillion) and Abu Dhabi Investment Authority ($0.99 trillion).
Earlier this year, US President Donald Trump signed an executive order to establish a national US SWF, potentially monetising federal assets. Indonesia launched its SWF Danantara in October, with an initial corpus of US$20 billion and an eventual asset goal of $900 billion over a period of time.