Millionaires increased by 20%; demonetisation impact wearing off, while GST is a transitory impact says Capgemini study

Last Updated: Tue, Jun 19, 2018 18:47 hrs
Rich India Poor India

A photo of the Mumbai airport adjacent to slums depicting two India. Credit: Youtube.

A study has found that India is one among the fastest markets for High Net worth individuals in the world.

The study from French technology consulting company Capgemini suggests that India's rankings in 2017 have been elevated to the eleventh. HNIs or High-net worth individuals are investors with asset size of over $1 million. The list is topped by countries such as US, Japan, Germany and China.

The report evaluated the riches amid the world and found that India's growth story could be rated as among the fastest-growing markets globally. Capgemini said that the country's growth on both the number of HNIs and wealth was faster than the global average of 11.2% and 12% respectively.

There has been a 20% increase in the number of dollar millionaires and their wealth in 2017 in India.

India's high net worth individuals have grown by 20.4% to 2.63 lakh people, and the collective riches of these people grew by 21% to $1 trillion.

Although 2017 saw the implementation of the GST, which was referred by many as a impediment to their businesses, the Capgemini report refers to the adverse impact owing to GST as "transitory".

Baring GST, there have been a host of other reasons that have lead to the sudden surge in dollar millionaires. The report cites reasons such as an over 50% surge in market capitalisation, an average 4.8% increase in realty prices and GDP expansion at 6.7% which was faster than the world.

The study also factored in other reasons such as a steady monetary policy, a wearing off of demonetisation impact, and higher savings rates that have aided in creating wealth.

Surveys and studies such as the one conducted by Capgemini have often plucked strings at the two extremes, at times in two very different octaves. At one end they reflect poorly of the social imbalance between the rich and the poor. On the other hand, they also highlight the market's development indices.

In January, another study stated that the top 1% of the over 1.2 billion population had cornered 73% of the overall wealth generated during the year. International rights group Oxfam that had released a study ahead of the World Economic Forum said that 67 crore Indians comprising the population's poorest half saw their wealth rising by just 1%.

The report, 'Reward Work, Not Wealth', has also found that India's top 10 per cent of population have 73 per cent of the total wealth in the country.

"Indian billionaires' wealth increased by Rs 4,891 billion - from Rs 15,778 billion to over Rs 20,676 billion," it said, adding the amount of Rs 4,891 billion was sufficient to finance 85 per cent of the budget on health and education in all Indian states.

Also read: India;s growing rich-poor divide richest 1% had 73% wealth