India ought to aim at setting up a sovereign wealth fund which is financially viable and have a broader objective of furthering the country s role as a global player.There are more than 50 sovereign wealth funds worldwide managing assets worth nearly three trillion dollars. Most of these are run by countries with huge trade surpluses and are funded mostly by oil and gas exports according to Kaushik Basu Chief Economic Advisor to India Finance Ministry.
But India unlike cpeers Malaysia and Singapore does not have one yet. Mr Basu said quick decision making and transparency should be built in features of the India sovereign fund. The global economic structure is changing and new instruments are coming he said adding growth comes from new ideas and innovation. ASSOCHAM s past president Anil Agarwal said sovereign wealth funds are an important component to generate nation s wealth.
They have emerged as formidable global investors and often evoke concerns in countries where they put in money. Basu was addressing industry leaders after releasing a study titled Sovereign Wealth Fund Vehicle for Global Strategic Acquisitions compiled by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) and the Private Equity and Venture Capital Association of India (PEVCAI). The headline inflation in April is expected to be less than 8 per cent Kaushik Basu said.
The wholesale price index rose to 8.98 per cent in March from a year earlier on the back of high fuel food and manufacturing prices. New methods are needed than the traditional ones to tackle this worrying piece of information said Mr Basu at a conference organised by Associated Chambers of Commerce and Industry (ASSOCHAM). He said high crude oil prices in global markets continue to be a matter of grave concern. However India is poised to clock nine per cent GDP growth in the current fiscal year 2011 12.
Agarwal said if India s GDP has to grow at more than 8 per cent then many sectors must grow faster than that. For this sovereign wealth funds will play a crucial role. PEVCAI chairman Arvind Mathur said these funds require governance of the highest standards and operational independence. The returns commensurate with the risks. According to the study the sectors which would benefit from acquisitions made by sovereign wealth funds could pertain to oil and gas coal and infrastructure.
With India s current growth the country will need to secure its energy needs of the future. The study said the purpose of setting up a sovereign wealth fund is to primarily garner better returns on existing foreign exchange reserves which now total over 300 billion dollars. At present most of these funds are of demand nature often used for macro economic exchange management and parked with the Reserve Bank of India which adheres to prudential norms.
Source: http://www.indiainfoline.com
But India unlike cpeers Malaysia and Singapore does not have one yet. Mr Basu said quick decision making and transparency should be built in features of the India sovereign fund. The global economic structure is changing and new instruments are coming he said adding growth comes from new ideas and innovation. ASSOCHAM s past president Anil Agarwal said sovereign wealth funds are an important component to generate nation s wealth.
They have emerged as formidable global investors and often evoke concerns in countries where they put in money. Basu was addressing industry leaders after releasing a study titled Sovereign Wealth Fund Vehicle for Global Strategic Acquisitions compiled by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) and the Private Equity and Venture Capital Association of India (PEVCAI). The headline inflation in April is expected to be less than 8 per cent Kaushik Basu said.
The wholesale price index rose to 8.98 per cent in March from a year earlier on the back of high fuel food and manufacturing prices. New methods are needed than the traditional ones to tackle this worrying piece of information said Mr Basu at a conference organised by Associated Chambers of Commerce and Industry (ASSOCHAM). He said high crude oil prices in global markets continue to be a matter of grave concern. However India is poised to clock nine per cent GDP growth in the current fiscal year 2011 12.
Agarwal said if India s GDP has to grow at more than 8 per cent then many sectors must grow faster than that. For this sovereign wealth funds will play a crucial role. PEVCAI chairman Arvind Mathur said these funds require governance of the highest standards and operational independence. The returns commensurate with the risks. According to the study the sectors which would benefit from acquisitions made by sovereign wealth funds could pertain to oil and gas coal and infrastructure.
With India s current growth the country will need to secure its energy needs of the future. The study said the purpose of setting up a sovereign wealth fund is to primarily garner better returns on existing foreign exchange reserves which now total over 300 billion dollars. At present most of these funds are of demand nature often used for macro economic exchange management and parked with the Reserve Bank of India which adheres to prudential norms.
Source: http://www.indiainfoline.com
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