Does India have a Sovereign Wealth Fund?
By BYJU'S Exam Prep
Updated on: November 9th, 2023
India has a sovereign wealth fund called the National Investment and Infrastructure Fund or NIIF. It was established by the Indian government in February 2015. As of September 2020, NIIF was in charge of roughly US$ 4.4 billion in assets. The state-owned investment funds are known as sovereign wealth funds.
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Sovereign Wealth Fund of India
The National Investment and Infrastructure Fund (NIIF), is a sovereign wealth fund that was established by the Indian government. Arun Jaitley, the finance minister at the time, announced its creation in the Union Budget for 2015–16. Sujoy Bose was chosen to serve as Managing Director and CEO of NIIF in October 2016.
Following are a few of the Sovereign Wealth Fund’s (SWF) main goals:
- Defending and maintaining economic and financial stability in the face of excessive export volatility.
- To generate higher profits than the reserves of foreign currency.
- To aid the monetary authorities in getting rid of any extra liquidity.
- To boost saving for upcoming generations.
- Supplying money for a nation’s social and economic growth.
- To offer the selected countries long-term sustainable capital growth.
Importance of Sovereign Wealth Fund
- Sovereign Wealth Funds (SWFs) were established to advance a nation’s economy and populace.
- According to the nonprofit Sovereign Wealth Fund Institute, SWFs have a higher risk appetite than conventional foreign exchange reserves since they value returns over liquidity.
- SWFs were established to support governments during fiscal surpluses or low levels of external debt. Some nations that rely on exporting raw materials like oil, copper, or diamonds cannot keep this extra cash for immediate consumption.
Summary:
Does India have a Sovereign Wealth Fund?
India holds a state-owned sovereign wealth fund by the name of the National Investment and Infrastructure Fund (NIIF). As of September 2020, NIIF was in charge of approximately $4.4 billion in assets. Government-owned investment vehicles are referred to as sovereign wealth funds.
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