New Delhi, May 21 -- Canada Pension Plan Investment Board (CPP Investments, or CPPIB), which had grown to become one of the largest foreign investors in India having committed more than $20 billion across various asset classes, has recorded a drop in its direct exposure to the country.
The pension fund's rupee exposure as part of its overall currency mix has declined to 3% of the total assets under management (AUM) for the fiscal year ended March 31, 2026, from 4% for at least three previous years.
CPPIB, the largest pension fund of the North American nation, kept its exposure to the Indian currency at 4% in FY25. This was on a par with the Chinese Renminbi and the Japanese Yen. While it maintained its currency exposure in China and Japan last year, the pension fund has let it slip in India, according to its latest annual report.
As a result, the total Indian currency exposure has likely slid to under $24 billion for the first time in three years. The Indian currency's exposure had been climbing in the previous three years.
To be sure, the actual exposure in dollar terms will be different as CPPIB would also be indirectly investing via third-party funds such as a global private equity fund based in the US that routes some of its corpus to India.
Moreover, the pension fund's absolute India investment value is an approximation as it is rounded off as against the exact percentage point exposure.
Notably, this amount and the percentage may have gone through further changes as the rupee has depreciated sharply against the dollar in the last two months after the US and Israel launched a war against Iran.
CPPIB invests in India through various routes including direct private equity bets and public market investments. It also backs Indian PE funds as a limited partner.
In the year ended March 31, 2026, in the private equity side, CPPIB invested$175 million in affordable housing finance company Aadhar Housing Finance, alongside Blackstone. It also bet $27 million in Federal Bank, alongside Blackstone.
It also committed $100 million to Accel Leaders 5, a venture capital fund that will invest in later-stage rounds of technology companies across the US, Europe and India. CPPIB also committed $400 million to Bain Capital Asia Fund VI, which will focus on control buyout investments across Japan, India, China, Australia and South Korea.
CPPIB noted that its Asia Pacific investments had a net return of 6.5% last year, primarily driven by public equity performance in Japan and China. These gains were partly offset by foreign exchange losses, reflecting the depreciation of the Indian rupee and Japanese yen relative to the Canadian dollar. In fiscal 2025, results were mainly driven by favourable foreign exchange movements, along with positive performance in China and India.
Over a longer period, in Asia Pacific, the fund achieved a 10-year net return of 7.1%. "Performance in the first half of the decade was supported by equity investments in the region, particularly in China. In more recent years, gains were driven primarily by equity investments in India, while returns in the region were negatively impacted by China's economic slowdown in the years following the COVID-19 pandemic," it noted.
Published by HT Digital Content Services with permission from VC Circle.