India sees 50% jump in millionaire exodus in 2016

ILLustration: Ajay Mohanty
Around 6,000 millionaires left India in 2016, mostly for countries like United Arab Emirates, United Kingdom, Canada, the United States, Australia and New Zealand. This figure stood at 4,000 in 2015 and around 6,000 in 2014. Since 2000, about 69,000 high net worth individuals in India have changed their domicile status, according to New World Wealth’s latest report on global wealth and wealth migration trends in 2016, titled The 2017 Global Wealth Review.

The study defines millionaires as those with net assets of $1 million or more.

India was placed fourth among Top-5 source countries for migrating millionaires.

For the second successive year, Australia topped the list of countries attracting the maximum number of ultra-rich people, beating popular hotspots like the United States and the United Kingdom. An estimated 11,000 millionaires moved to Australia in 2016, while 10,000 moved to the US and 3,000 moved to the UK. The study said that global wealth migration accelerated in 2016 with 82,000 millionaires shifting overseas, compared to 64,000 in 2015.

MILLIONAIRE MIGRANTS
Top-5 destinations (net inflow)
Australia 11,000
United States 10,000
Canada 8,000
UAE 5,000
New Zealand 4,000
Top-5 source countries (net outflow)
France 12,000
China 9,000
Brazil 8,000
India 6,000
Turkey 6,000
Figures pertain to the year 2016; Source: The 2017 Global Wealth Review
According to Andrew Amoils, head of research at New World Wealth, the outflow of high net worth individuals from India in 2016 is not a big concern given that the country produces more new millionaires than it is losing. “Once the standard of living in India improves, we expect several wealthy people to move back,” he noted.

India was home 264,000 millionaires and 95 billionaires with total wealth held in the country amounting to an estimated $6.2 trillion (as of December 2016), the report said.

The report attributed Australia’s growing popularity to the country’s healthcare system, location advantages for doing business in emerging Asian countries, insulation from the refugee crisis in Europe, safety, lower inheritance tax, among others.

On the other end of the spectrum, the countries that lost large numbers of high net worth individuals in 2016 included France, Turkey and Brazil. The report said that France – with 12,000 millionaires moving out of the country in 2016 - was being heavily impacted by rising religious tensions between Christians and Muslims, especially in urban areas.

“We expect that millionaire migration away from France will accelerate over the next decade as these tensions escalate. In our view, other European countries where religious tensions are starting to emerge such as Belgium, Germany, Austria, the UK, Holland and Sweden will also be negatively affected in the near future,” the report said.

Commenting on the adverse impact of millionaires leaving a country, the report noted that this has negative impact on the local currency, local stock market and the property market. “Millionaires employ large numbers of people. Around 30% of millionaires are business owners,” the report said. This also has an impact on local consumption of goods and services and tax collection.


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