Indians' households savings to touch $5 trillion by 2020

India may takeover the US in terms of households savings by 2020, touching the $5 trillion mark, as the growing economy would boost incomes of people, a study has said.

"The household savings rate of 33.4 per cent would translate into incremental savings of $5 trillion over the next decade with growing incomes of Indian households," Assocham President Swati A Piramal said in a statement.

Currently, the size of Indian household savings is over $330 billion, according to a study jointly done by Assocham and PricehWaterhouse Coopers.

Indian households have traditionally preferred safety of bank deposits and government saving schemes. Less than 10 per cent of their investments are in other financial assets like shares, debenture and mutual funds, which is low as compared to some of the developed economies, Piramal said.

"Given the quantum of savings, the need to mobilise savings into productive channels and the opportunity for financial intermediation, the next decade will be an opportunity of a lifetime for Indian capital markets," the study said.

It said, currently, Indian economy's size is about $1 trillion with the savings rate of Indian households of 33.4 per cent, which is expected to grow further at an average rate of 8 per cent annually.

Concerted efforts of the government and the regulators supported by a long-term vision and a clarity in action can significantly help in fostering a climate that is conducive to growth and investments, Piramal said.