India to have more millionaires than China

By Our Special Correspondent

Mumbai, May 7: India will beat China by 2017 in at least one area, when it will have more millionaires in dollar terms than China. India will have over four lakh millionaires in dollar terms by 2017 and they will have an aggregate wealth of $1.7 trillion.

To get an idea of the enormity of this wealth, one can compare it to India’s present market capitalisation, which is between $1.2 trillion and $1.4 trillion.

On the other hand, China will just have half that number (around 2 lakh) of millionaires, with an aggregate wealth of $800 billion.

The main drivers for India will be the rising entrepreneurship, growing economy, value unlocking and the promtoers’ wealth. The Indian mass affluent population will grow from negligible to nearly 20 lakh people by 2017. There will be around 19 lakh households that will have half a million dollars each and 2.9 crore households that would have $100,000 each in wealth.

These figures, compiled by the Economic Intelligence Union and Barclays Wealth, represents the opportunities there are for companies like Barclays to come and manage this wealth. Indians are not managing their wealth creation for optimum results feels Mr Satya Narayan Bansal, India chief executive, Barclays Wealth.

More than half the wealth of India’s rich is in physical assets. 43 per cent is in property and then comes accumulated gold estimated at $200 billion which is equal to half of the deposits in the banking system.

But, he says, there is a shift to financial assets from physical. Barclay’s Wealth is currently in India to set up an office and will start functioning in the second half of 2008. They expect to tap the high net and ultra high net individuals who could have a total wealth of $2 million to $3 million. He said the new wealth that has been created is higher than the inherited wealth in India.