The Indian government is embarking on a new initiative to bolster its economic prowess on the global stage. As part of its ambitious goal to transform India into a $30 trillion economy by 2047, the government has commenced preliminary discussions with key stakeholders to explore the viability of establishing a sovereign wealth fund (SWF).
These discussions, reported by CNBC-TV18, involve prominent institutions like the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), and officials from GIFT City. The concept of an SWF has gained significant momentum since the inauguration of Prime Minister Narendra Modi’s third-term cabinet. Officials involved in the discussions strongly believe that such a fund could play a pivotal role in amplifying India’s financial influence on the global stage.
The proposed SWF envisions a significant increase in India’s capacity to invest in infrastructure projects abroad, particularly in neighboring countries and regions like Africa, which are strategic priorities for the Indian government. To gauge the level of interest and potential success, the government has sought feedback from over 30 Public Sector Undertakings (PSUs). Initial proposals suggest that a $5 billion fund could generate annual investment opportunities worth $10 billion, attracting substantial global interest.
A key consideration is whether the SWF would grant India greater leverage in supporting friendly nations compared to current methods, such as lines of credit and grants. The fund is expected to operate through a Public-Private Partnership (PPP) model, enabling India to make strategic investments abroad.
While discussions are still in the early stages, sources indicate that momentum has been building over the past month. The government is expected to take further steps in the coming weeks to explore the fund’s potential, initially focusing on PSUs and later expanding to institutions like the Japan International Cooperation Agency (JICA) and listed companies.
