Even as India's once red-hot economy is showing signs of a slowdown, the number of millionaire households in Asia's third-largest economy is growing at a rapid pace.
The number of millionaire households in India jumped nearly 21 per cent to 162,000 in 2011 from 134,000 in 2010, according to The Boston Consulting Group's (BCG) global wealth report. Ultra-high-net-worth households, those having more than $100 million (Rs 560 crore) in private financial wealth, in India increased 15.35 per cent to 278 in 2011 from 241 in 2010.
The sharp increase in millionaire households in India comes at a time when the economy's growth is faltering. The country's gross domestic product (GDP) grew 5.3 per cent in the January – March quarter from a year-ago period, lowest in the last nine years.
India ranked 13 in the world in terms of number of millionaire households in 2011. The US had the largest number (5.1 million), followed by Japan (1.6 million) and China (1.4 million), according to BCG.
In neighbouring China, the number of such households rose 15.56 per cent to 1,432,000 in 2011 from 1,239,000 in 2010.
Globally, the number of millionaire households increased by just 175,000, or 1.4 per cent, to 12.6 million in 2011 from a year-ago period.
Private financial wealth includes cash and deposits, money market funds, listed securities held directly or indirectly through managed investments, and other onshore and offshore assets. It excludes investors' own businesses, residences, or luxury goods.
Private wealth in Asia-Pacific (ex-Japan) increased by 10.7 per cent in 2011 to $23.7 trillion. BCG expects wealth in the Asia-Pacific region to continue growing at a double-digit rate, with a projected compounded annual growth rate (CAGR) of 11.1 per cent, and reach $40.1 trillion by the end of 2016. By then, the global consulting firm expects private wealth in Asia Pacific (ex-Japan) to slightly overtake Western and Eastern Europe combined.
"These gains should be driven largely by sustained strong gross domestic product (GDP) growth in China and India and overall stronger stock-market performance," BCG said.
BCG expects emerging markets like China and India to fuel the growth of global wealth. It expects private wealth in India and China to grow at a CAGR of 19 per cent and 15 per cent, respectively, between 2012 and 2016, significantly faster than the global forecast of four to five per cent annually. India will account for 10 per cent (about $2.7 trillion) of the overall increase in global wealth between 2012 and 2016, according to the report.