Shromon Das discusses Sovereign wealth funds, a new phenomenon in the global financial arena.

Logic and rationality prevail in a utopian world. Unfortunately, this is not the case in the world we live in. While one may justify a SWF on the basis of its economic logic, the industry has been mired in controversy. The reason being that unlike private investment funds, the stake holder in a SWF is a government, and not an individual. This may seem to be trivial, but is not really so. The French may not object to a Chinese buying property or setting up a business in France. But will it sit back quietly if the China Investment Corporation makes a bid for Total, or for Charles De’Gaulle Airport?