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Between 2023 and 2028, India will witness the highest growth for any country in the number of ultra high networth individuals (UHNWIs), with a networth of $30 million or more, according to a report released on Wednesday.
According to Knight Frank’s flagship study, ‘The Wealth Report 2024’, the number of ultra-rich Indians will rise by 50.1 per cent to 19,908 in 2028 from 13,263 in 2023.
India will be followed by China (47 per cent), Türkiye (42.9 per cent), and Malaysia (35 per cent). Liam Bailey, global head of research at Knight Frank, told Business Standard that the main reason behind this high growth rate in India is its robust gross domestic product (GDP) growth.
“The primary reason is the outlook for the Indian economy. We use economic forecasts in terms of GDP growth for each country that we cover. And there, the view is that the Indian economy is set to outperform over the next five years. That is the biggest driver,” he said.
Bailey added that its large diaspora also ensures a high level of innovation and strong connectivity with outside businesses and countries.
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The report also highlighted that Asia will dominate the rise in the number of ultra-rich. In Asia, the number of ultra-rich is expected to rise by 38.3 per cent in the next five years. Globally, the number of ultra-rich is likely to rise by 28.1 per cent.
Bailey said that Asia has been a standout region in terms of economic growth in the past 15–20 years.
“The centre of gravity of the world economy has moved towards Asia, and the process is continuing,” he said. Bailey also said that Asia is likely to be followed by West Asia and North America in terms of generating ultra-rich by 2028.
The report also highlighted that in 2023, India saw an annual rise of 6.1 per cent in the UHNWI population over the previous year. Globally, the number of UHNWIs rose by 4.2 per cent to 626,619. These ultra-rich Indians are optimistic about their wealth growing in 2024.
“Ninety per cent of Indian UHNWIs are expecting an increase in their wealth this year,” the report said. Around 63 per cent of these UHNWIs expect an increase of more than 10 per cent in their wealth in 2024.
According to Shishir Baijal, chairman and managing director at Knight Frank India, the landscape of affluence in India is “vibrant and dynamic”.
“While global uncertainty prevails, easing domestic inflationary risks and the likelihood of rate cuts will further accentuate the growth of the Indian economy, and the reflection of this sentiment is echoed by wealthy Indians,” he said.
The report also highlighted that, among these ultra-rich Indians, watches were the most preferred choice for investment in 2023, followed by art and jewellery.
Notably, according to Knight Frank’s Luxury Investment Index 2023, the prices of watches have jumped 138 per cent in past decade. The price appreciation for art and jewellery has been 105 per cent and 37 per cent, respectively.
Globally, the trends are slightly different.
The more preferred luxury investment has been art, followed by watches and classic cars. The prices of cars have surged by 82 per cent in 10 years.
“With both domestic and global markets offering significantly higher returns for such items, India’s ultra-wealthy are actively pursuing investment opportunities in areas aligned with their passions,” Baijal said.
“The demand for rare collectibles is on the rise across different age groups in India, and as wealth continues to grow in the country, we can anticipate further investments in these asset classes.”
