2018 Henley Global Citizens Report predicts:
According to the 2018 Henley Global Citizen Reports as many as 8,000 high-net-worth individuals are estimated to leave the country this year for a better economy.
With the onward trend that boomed in the early 90’s attracting millions to the shores of the Gulf and North American regions for better living conditions, entrepreneurs and super-wealthy seek to migrate to foreign nations for exploring global opportunities.
The hope for a better standard of living fused with stringent Indian economic tax requirements, as well as the desire for a stronger passport are major facets among others that drive the wealthy populace outside the Indian subcontinent.
The report argues that the number of US dollar millionaires that rake crores in India will shoot up by an astounding 80% over the duration of the next 10 years. While it will only surface to a hike of 20% in the US, 10% in France, Italy, UK and Germany combined.
“General wealth projections for India are very strong. We expect the HNWI (high net worth individuals) population to rise by 80% by 2031, which will make India one of the world’s fastest growing wealth markets during this period. This will be fueled by especially strong growth in the local financial services, healthcare, and technology sectors, “ added New World Health, Head of research, Andrew Amoils.
Why is this trend important?
What we must observe is that the over-all Indian atmosphere for the new trendy generation to explore economic opportunities outside its industrial base is thinning every day, the new school that desires to reap the rewards of the technological advancements along with traditional tycoons do not find the Indian markets a worthy spot for growth.
Additionally, the glee that promises their future generations better education, lifestyle, health facilities and opportunities also continue to pull the wealthy out of the country.
“Increasingly stringent tax residency rules (introduced in 2020 and 2021), with no relief in individual taxation rates for HNWIs, coupled with a desire for visa- free travel are also consistent primary motivators for alternative residence and citizenship,” commented Bijal Ajinky, Partner in the Direct Tax, Private Client and Investment Funds of Khaitan and Co.
Where are our wealthy headed to?
Europe, North America, Dubai and Singapore are among the top magnets pulling the plutocrats in promise of a better life. Singapore and Dubai respectively known for their robust digital markets and economic diversity have been the traditional favourites for decades.
Dubai that introduced its Golden Visa which guarantees several options amidst its low tax rates is a formidable candidate that pulls the rich of our country.
According to the Henley Private Wealth Migration Dashboard, the Islamic state is set to pull the largest inflow of HWNI’s internationally this year (at least 4,000).
While Singapore remains as a youth-favourite accounting for its commendable technological growth and world-class financial advisers, the nation is currently ranked third, behind Australia with a HWNI inflow of at least 2,800 this year.
Followed by Israel, with 2,500 closely matched also by Switzerland and the US with 2,200 and 1,500 scores respectively.
“We are also starting to receive considerable interest from families from across Asia who are looking to make Singapore or the UAE their established base. Countries that are providing excellent infrastructure for wealth preservation are likely to remain popular destinations,” commented Nirbhay Handa, Group Head of Business Development at Henley & Partners.
The fresh predictions from the reports argues that the net inflow-outflow rate of US Dollar millionaires will narrate on average a loss of up to 8,000 HNWIs this year. The reports further suggested that although the wealthy initially set to leave the nation, there is an equal tendency to return once India’s living standards improve.
The numbers must not terrify the Indian economy because the same produces more billionaires every year than the numbers lost to migration.
“Challenges for Indians include stringent exchange controls for making remittances, inheritance taxes for overseas assets, and Indian residency rules targeting statelessness. Indians are progressively turning to legal and financial advisors for nuanced advice on navigating these obstacles through the use of private trusts, holding entities, separate wills for different jurisdictions, and so on. Individuals are advised to start planning well before they intend moving any capital to avoid any unpleasant surprises” added Ajinky.
A section of this group also looks towards European nations such as Portugal, Malta and Greece, in light of their high standard of living and low physical recruitments, an attractive feature needed for those who wish to maintain their assets or family in India.
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