India’s millionaires set to grow at 34% by 2020

Key highlights:

• The number of Indian millionaires (or HNWIs) is forecast to grow by 34%, to reach 371,150 by 2020, while HNWI wealth is projected to grow by 53.1% to reach US$2.1 trillion

• However, India’s wealthy are recovering from recent economic turmoil - their number grew at only 4.4% last year following a 1.1% decline from 2013-2014

• The collective wealth of India’s HNWI population is US$2.1 trillion, an average wealth of US$4.9 million each. That’s US$1.3 million higher than the average wealth of a Chinese millionaire

• Mumbai dominates as India’s wealth hub - it is home to 97,912 HNWIs, that’s 37.4% of all India’s HNWIs, making it the 10th richest city in Asia

The number of millionaires being created in India is set to grow at an unpresented 34% in the five years to 2020, finds new research from WealthInsight. The increase comes at a time of turmoil in most emerging markets and concerns over inequality.

Much of India’s growth will be derived from the technology sector, which currently accounts for 15.1% of all HNWI wealth, having grown by 18.1% over the last five years. On a global scale, this percentage of HNWIs earning their wealth through tech is second only to the US and Israel.

This rapid growth in wealth is as much down to rampart entrepreneurism as it is a surging economy, explains Oliver Williams, Head of WealthInsight: “The number of millionaire entrepreneurs is on the increase in India, having grown by nearly 7% in the past year. Much of this has been driven by the tech sector; small businesses that have surged in a number of ‘silicon spots’ throughout the country.”

“The tech sector has in turn thrived on angel investments – proof that many of India’s HNWIs and Non-Resident Indians (NRIs) are putting money back into the economy. The technology space is attaching 51% of all angel and venture investments made in India,” says Williams.

This is despite a trend in developed markets such as the US that have seen a curbing in the ranks of tech HNWIs.

Mumbai dominates as India’s wealth hub

• Mumbai is home to 97,912 HNWIs, that’s 37.4% of all India’s HNWIs, making it the 10th richest city in Asia

• Mumbai is also the fastest growing city for HNWIs since 2010 (16.2%), closely followed by Chennai (15.6%) and Hyderabad (14.5%). In the next five years, Mumbai will continue to be India’s fastest growing city for HNWIs, with an expected increase of 31.2%

• Delhi, India’s capital is second only to Mumbai in millionaire numbers: it is home to 24,918, 12.3% of India’s HNWI population

“Like most emerging countries, the concentration of India’s wealth lies in its cities,” says Williams. “However, cities with thriving technology and financial markets have seen, and will continue to witness, the highest growth of wealthy individuals.

“By 2020, Mumbai will become one of Asia’s major wealth hubs as its millionaire population swells to 142,000. However, confined inequality could pose a serious issue to this status as India’s mass urbanisation is buttressed by surging wealth.”