China Investment Corporation (CIC), China's $300-billion sovereign wealth fund, may get additional $200 billion from the country's massive $2.27-trillion foreign exchange reserves, said the Financial Times  reported today.

The UK-based paper, citing unidentified government officials and people familiar with the fund, said that the amount to be handed to CIC would be similar to the $200 billion given to it when the fund was launched in 2007.

While a final decision has yet to be made, the Chinese media has also reported that the government is considering a new capital injection of $200 billion for the fund.

Any infusion of fresh funds into CIC would be an acknowledgement from the Chinese government that CIC has shown excellent results compared to Singapore's wealth fund Temasek, although it came under criticism for incurring book value losses on its investments in Morgan Stanley and the US private equity firm Blackstone during the global financial crisis.

CIC had invested $3 billion for a 9.4-per cent stake in Blackstone Group in June 2007 and took a 9.9-per cent stake in Morgan Stanley for $5 billion in December 2007.

CIC is considered to be one of the most aggressive sovereign wealth fund having made just $4.8 billion in new overseas investments in 2008 with a portfolio return of 2.1 per cent during the world's worst recession, but said in August that it would increase new overseas investment this year by more than 10 times last year's figure.

Gao Xiqing, CIC's general manager, said yesterday that the fund is raising the investment bar from 10 per cent to 20 per cent covering the resources, energy and real estate sectors.

Since July, CIC has made increasing investments in global natural resources companies.

It took a 17.2-per cent stake for $1.5 in Canadian miner Teck Resources Ltd, took a 15 per cent stake for $1.58 billion in the US-based power company AES Corp, acquired 45 per cent of Russia's Nobel Oil Group for $300 million, invested $500 million in Vancouver, Canada-based SouthGobi Energy Resources, purchased approximately 11 per cent of the Global Depositary Receipts of JSC KazMunaiGas Exploration Production of Kazakhstan for $939 million and agreed to buy $1.9 billion of debt from Indonesia's largest thermal coal producer PT Bumi Resources.

With Chinese largest banks expected to raise approximately $50 billion in new capital over the next couple of years to meet tighter regulatory requirements, and CIC holding controlling stakes in most of them, the fund will be providing most of this capital in order to avoid its holdings being diluted.

This factor could also be influencing Beijing's decision to give CIC additional money to maintain its holding levels in Chinese banks.