Invest and emigrate: How Indians can find a new life abroad

Indians who dream of emigrating can purchase a better life in a new country—if they have a few crores to invest.

Many rich nations offer immigrants a variety of investment options in a quid pro quo arrangement: immigrants get a better quality of life and revenue from them helps these countries’ finances.

Aspiring for a better life

Indians regarded as high net worth individuals (HNIs)--a person with more than Rs 5 crore in investable surplus--have enough reasons to consider emigrating. They don’t want their children to live in the gas chambers that Indian cities have become. As many as seven of the world’s 10 most polluted cities are in India, said a Greenpeace and IQAir AirVisual study in March 2019.

Foreign investors may find India has become an easier place to do business, but for local entrepreneurs compliance requirements have actually increased and petty corruption remains a bugbear. Affluent parents worry that their children, brought up in a cloistered environment, will be unfit for the Indian way of doing business.

Often, young people do not want to return home after studying abroad. Aging parents then opt to emigrate to be with them.

As more Indians travel abroad, they get a taste of the quality of life in advanced countries. This, too, stirs within them the desire to emigrate.

“Industrialists who have a net worth of Rs 100 crore-300 crore are not the ones migrating. They already have well-established international operations, and their children may already be settled outside India. Those migrating today are people who have a net worth in the range of Rs 3-25 crore,” said Ajay Sharma, principal at Abhinav Outsourcings and an immigration expert.

Invest and go West

Emigration programmes for Northern America begin from Rs 50 lakh and can go up to Rs 10 crore-Rs 15 crore. Canada has become a favoured destination for Indians after the US tightened immigration rules. “It has a large Indian population that is politically strong; Indians are well accepted in Canada. And it has for long had an immigrant-friendly policy that makes people comfortable about going there, unlike the US and large parts of Europe, which have witnessed an upsurge in xenophobic sentiment in recent times,” said Sharma.

The UK, too, remains a favourite destination because of its large Indian diaspora. However, until the dust from Brexit settles down, immigrating to the UK could be difficult. New Zealand and Australia are other favourite destinations.

Two options: Active or Passive Investment Programme

Those wanting to purchase a country’s residency can invest in an active or a passive programme.

For an active investment programme, the investor must be physically present in that country and manage the business on a day-to-day basis.

In a passive investment programme, on the other hand, an investor can purchase real estate, or invest in bonds to earn the residency status of a country. The investor gets her money back after a certain number of years, along with a rate of return that could be fixed or market-linked. The investor is not obliged to run an actual business.

The Quebec Immigrant Investor Programme is a popular passive investment programme run by Canada’s second most populous province. It offers a permanent residency for an investment of Canadian $2 million (about Rs 10.83 crore).

“This programme is not doing as well today because the investment amount required has gone up. But I expect it to become the most sought-after programme again once the investment required in the US EB-5 programme rises from November,” said Sharma.

The investor’s money is put in Canadian government bonds. The programme is popular because people do not have to deal with private investors, as is the case with USA’s EB-5 programme. It is even possible to get financing from a Canadian bank. After five years, the investor gets residency and her money back.

Taking the passive investment route to the UK requires a higher expense.

An active investment programme, also known as entrepreneurial programmes, can start from as low as Rs 1 crore-Rs 1.5 crore and go up to Rs 5 crore-Rs 7 crore. In these programmes, an investor usually does not get residency initially. She gets a temporary visa for two-three years and has to promise to invest an amount and create a certain number of jobs. She gets residency status once she has fulfilled these promises.

Experts warn applicants for the active programmes invite intense scrutiny. “Earlier a lot of immigrants would arrive on these visas and then neither invest not create jobs. Now, governments across the world have wised up. People who fail to meet either of these conditions get deported once the temporary visa period ends,” said Sharma.

People who cannot relocate permanently and manage the proposed business daily should avoid this option either.

The US EB-5 Investor Visa programme requires a person to invest at least $500,000 and create 10 permanent full-time jobs for resident US citizens. The job creation function is outsourced to US-based specialists, referred to as regional centres. Regional centres provide funding to development projects through the EB-5 programme. These projects usually create construction jobs on basis of which the investor gets a green card.

An investment of $ 500,000 in the EB-5 programme allows an investor, her spouse, and their unmarried children obtain residency. “From November 21 this year, the investment required in the EB-5 programme will nearly double from $500,000 to $ 900,000,” said Vivek Tandon, founder and CEO, EB5 BRICS.

Investors need to choose a good regional centre that can help them select a good project. “Ask the regional centre you are dealing with for its track record in the EB-5 industry: the number of people whom they have helped obtain green cards, the number of people whose investments they have returned, and so on. I would even suggest flying out to the US, meeting the team at the regional centre, and checking the project in which they will invest,” said Tandon. Remember that this a market-linked investment in which people could lose your money if things don’t pan out well.

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