According to the fund’s latest annual disclosures, India’s share in the portfolio fell by about 40 basis points to 2.1% as of December 31, 2025.
Market participants attribute the reduction largely to the relative performance of Indian equities during the year. While the fund generated an overall return of around 15% in 2025, its India investments declined about 1.4%, making it the only major market in the portfolio to deliver negative returns during the period.
The decline in India’s weight coincided with higher allocations to some other Asian markets. The share of China in the fund’s portfolio rose by roughly 30 basis points to 3.6%, while Taiwan saw its weight increase by around 20 basis points to 2.7%, surpassing India in the overall allocation.
Large global funds such as Norway’s sovereign wealth fund typically follow market-capitalisation-based benchmark indices to determine portfolio allocations. In this approach, the weight of individual markets and stocks automatically adjusts in line with their performance and market value. Stronger-performing markets see their share rise, while weaker ones tend to lose weight.
The Norwegian fund invests according to a reference benchmark set by the Norwegian Ministry of Finance, which is based on the FTSE Global All Cap Index.
“We are invested globally according to a reference index set by the Norwegian Ministry of Finance, which uses the FTSE Global All Cap index as a starting point. We do not comment on the outlook for specific markets,” a spokesperson for Norges Bank Investment Management said in response to queries.
In some cases, the fund also makes discretionary changes to its holdings. Earlier this year, it removed Adani Green Energy from its portfolio amid an ongoing investigation by the U.S. Securities and Exchange Commission.
Analysts say India’s weight in global portfolios could remain under pressure in the near term if the domestic market continues to trail other emerging markets.
Within the fund’s global portfolio, Taiwan emerged as the best-performing market in 2025 with dollar returns of about 37%, followed by Canada with gains of around 33%.
Despite the recent decline, the Norwegian fund’s exposure to India remains significantly higher than it was a few years ago. Between 2021 and 2024, the value of its India portfolio roughly doubled to about $36 billion. However, the value slipped to about $31.4 billion by the end of 2025 as market performance weakened.
The composition of the fund’s India investments has also evolved over time. Until 2019, fixed-income securities accounted for roughly 20–30% of its exposure to India. In recent years, however, the fund has shifted decisively toward equities, with debt investments now accounting for less than 5% of the India portfolio.