Rich becoming richer: 48 pc of India's wealth held by high-net-worth individuals

Money Rupee cash Representational image | PTI

India has witnessed highest growth in wealth held by individuals, among top ten wealthiest nations in the world, according to AfrAsia Bank's Global Wealth Migration Review.

Wealth held by the country rose 25 per cent, from $6584 billion in 2016 to $ 8230 billion in 2017, higher than China, Australia and the US. By 2027, India's wealth is expected to grow to $24,691 billion, a growth of 200 per cent—again the highest in the group.

On the contrary, Pakistan, Nigeria and Venezuela have been the worst performing wealth markets, that is, wealth in these countries has seen an erosion, primarily due to safety concerns and stock market losses.

The report considers wealth to be a far better measure of the health of an economy than GDP, the reason being that a large portion of GDP flows to government in certain countries, and therefore has little impact on private wealth creation.

Global wealth has risen by 27 per cent over the past 10 years (from $169 trillion at the end of 2007 to $ 215 trillion at the end of 2017) assisted by strong wealth growth in Asia. Vietnam, a relatively less known Asian economy, is among the best performing wealth markets in the world followed by China, Mauritius, Ethiopia and India.

What will help wealth creation in India is the large number of entrepreneurs, good educational system and an English speaking population, says the report. Strong growth forecast in local financial services, IT, BPO, real estate, healthcare and media sector will further propel India to one of the highest wealth creators.

One of the other interesting aspects in the report is about wealth inequality. India is among the most unequal countries in the world, with 48 per cent of the wealth held by high networth individuals. In Saudi Arabia, the number is at 60 per cent followed by Russia (58 per cent), Nigeria (56 per cent), Brazil (53 per cent) and Turkey (52 per cent). Japan is the most equal economy with billionaires only controlling three per cent of total wealth there.

According to the report, India is also among countries that have experienced biggest migration of high-net-worth individuals. 7000 HNWIs migrated out of the country in 2017. These HNWIs are moving to US, UAE, Canada, Australia and New Zealand.