RBI Governor YV Reddy said the central bank is watching private equity and hedge fund players' development for transparency, reports CNBC-TV18 quoting Newswire18. He said the forex reserve management reflects liquidity risk on flow change. “Forex reserve rise reflect economy's low absorptive ability.”

According to Reddy, it is possible to argue a case for a sovereign wealth fund. “It is difficult to reckon sovereign funds in the Indian context.”