India Sees 40 Basis Point Weightage Reduction in Norway Pension Funds, As China and Taiwan Gain Allocation

Norges Bank Adjusts Portfolio Allocation

Key Highlights:

• Norges Bank, the world's largest sovereign fund, has reduced India's weight in its portfolio by 40 basis points to 2.1% as of December 31, 2025.
• This adjustment is a result of India's underperformance compared to other emerging markets in 2025.
• India's portfolio underperformed its peers significantly in 2025, with a 1.4% decline in value, while the fund as a whole posted a 15% return.

Portfolio Rebalance

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• The reduction in India's weight has benefited China, whose weight has increased by 30 basis points to 3.6%.
• Taiwan has also seen its weight increase by 20 basis points to 2.7%, surpassing India's weight in the portfolio.
• Taiwan was the best-performing market within Norges Bank's portfolio in 2025, with a 37% dollar return, followed by Canada with a 33% return.

Market Expert Insights

• Market experts predict that India may continue to lose weightage in the Norway Pension Fund due to its underperformance compared to other emerging economies.
• Kranthi Bathini, director of equity strategy at WealthMills Securities, notes that many global funds are adopting a defensive strategy by reducing equity exposure and increasing cash positions.

Portfolio Performance

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• The India portfolio of Norges Bank doubled in value to reach $36 billion between 2021 and 2024.
• However, as of December 31, 2025, the value of the India portfolio has fallen to $31.4 billion.
• Norges Bank has increasingly focused on equity investments, with debt comprising less than 5% of its portfolio.