India shows fastest growth in wealth and HNI population

Chennai: India was globally the fastest-growing market in terms of high net-worth individual (HNI) population and wealth in 2017. By growing HNI population by 20.4 per cent and HNI wealth by 21.6 per cent, India also inched up to the 11th position in the list of countries with HNI population.

In 2017, the high net-worth individual population in India went up to 2,63,300 from 2,18,600 in 2016. Their cumulative wealth grew to USD 1067.1 billion in 2017 from USD 877 billion in the previous year, according to the Capgemini’s World Wealth Report 2018.

The report classifies individuals with wealth of over USD 1 million and up to USD 30 million as high net-worth individuals and those with wealth of above USD 30 million as ultra high net-worth individuals.

Among the factors that helped India clock the highest growth rate, market capitalisation rose sharply by 51.3 per cent in 2017, after a weak growth of 3.1 per cent in 2016.

Last year, the market grew sharply on account of strong support from local and foreign institutional investors, which helped pump liquidity into the market, coupled with hopes of an improvement in economic growth and corporate earnings.

Further, national savings as a percentage of GDP stood at 29.2 per cent in 2017 and the GDP itself grew by 6.7 per cent. The major driving factor for growth was increased consumption, which recovered after the liquidity crunch associated with demonetisation, found the report.

Indian property prices too grew by 4.8 per cent in 2017 as compared to 2.7 per cent in 2016. Regulatory reforms such as the Real Estate Regulatory Authority (RERA) and Goods and Services Tax (GST), stable demand and rising household incomes were some of the important drivers of growth for the real estate sector.

The fastest growth in HNI population and wealth saw India move up by one slot to occupy the 11th position among global economies. The US, Japan, Germany and China held the top four slots, accounting for 61.2 per cent of the global HNI population of 18.1 million.

Globally, HNI wealth grew 10.6 per cent to cross USD 70 trillion for the first time. The year 2017 also saw the sixth consecutive year of gains and was the second-fastest year of growth since 2011.

Asia-Pacific region and North America were the key drivers of the growth. Asia-Pacific clocked the fastest growth among different regions at 12.1 per cent, followed by North America at 9.9 per cent.

Global market capitalisation, which grew by 21.8 per cent, helped the increase in HNI wealth. The global GDP too grew by 3 per cent in 2017 against 2.3 per cent in 2016. HNI wealth is expected to touch USD 100 trillion by 2015.