New Delhi: Fewer millionaires are projected to migrate out of India in 2024, which would establish a declining trend of millionaire emigration over the last two years, according to a new report on the migration patterns of high net-worth individuals. The report has also pointed out that India is adding “far more” millionaires than it is losing to emigration.
The Henley Private Wealth Migration Report 2024, released last week, said that India would rank third in the world this year in terms of the net outflows of millionaires from the country, with 4,300 more millionaires leaving than arriving. The top two countries on the list are projected to be China (15,200) and the UK (9,500).
However, a comparison with previous available reports by Henley shows that India’s projected net outflow of millionaires in 2024 is lower than what happened in 2023 (6,500) and in 2022 (7,500). This means that if the estimate for 2024 turns out to be correct, this would be the second-consecutive year with a drop in the net outflow of millionaires from the country.
Congress leader Jairam Ramesh raised the issue of the outflow of millionaires, saying that it could be due to “opaque tax policies and an arbitrary tax administration, quite apart from the overall climate of fear and intimidation surrounding corporate India in the past decade”.
“Increasingly business personalities are relocating to Singapore, UAE, UK and other places,” Ramesh added, in a post on X. “Surely, such outmigration of high net-worth Indians should be a matter of concern, if only because it substantially erodes the Union Govt’s tax base.”
Millionaire outflow less of a concern
However, according to analysts, whose insights were included in the Henley report, this outflow of millionaires is not really a cause for concern and is, in fact, a result of the rapid rise in the number of high net-worth individuals in the country, and their growing economic clout.
“Both China and India (ranked first and third, respectively) are seeing high net outflows because of the success of their sizeable economies in generating millionaires, although slowing wealth growth in China in recent years could mean sustained high outflows become more damaging over time,” Hannah White, Director and CEO of the Institute for Government in London, said in her note in the report.
Similarly, Misha Glenny, rector of the Institute for Human Sciences in Vienna, said that although India is seeing a steady net outflow of millionaires, “the story is more positive”.
“Opportunities for overseas investments are opening up for many wealthy Indians, especially in Australia and the USA,” Glenny said in his note. “Canada is again an important destination although politics has intervened here after Ottawa accused Narendra Modi’s government of having ordered the murder of a prominent Sikh opposition activist on Canadian soil.”
Curtis S. Chin, senior advisor for global markets at the Milken Institute, noted that while India has overtaken China as the world’s most populous country, its net millionaire exodus is less than 30 percent of China’s.
“India’s net loss of high-net-worth individuals also may well be of less concern given the nation’s still growing population,” Chin wrote. “As with China, this is a small percentage of the overall millionaire population.”
According to Henley’s data, India ranks 10th in the world with 3,26,400 high-net-worth individuals, including 1,044 centi-millionaires (with more than $100 million in wealth) and 120 billionaires. This is the third-highest billionaire population in the world.
“While India loses thousands of millionaires each year, with many migrating to the UAE, concerns over the outflows may well be mitigated as with wealth growth of 85 percent over the past decade, the country continues to produce far more new high-net-worth individuals than it loses to emigration,” Chin added.
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Emigrating in search of a better lifestyle
There is agreement among the experts cited in the report that another reason millionaires are choosing to leave India — albeit in decreasing numbers — is in pursuit of a better lifestyle.
“As do those from many other developing nations, (including notably Brazil, Vietnam, South Africa, and Nigeria), Indian millionaires often depart the sub-continent in search of a better lifestyle, safer and cleaner environments, and access to more premium health and education services,” White said.
Chin made similar observations and also cited India’s deteriorating air quality as a possible reason.
“By some measures, India now has some of the world’s worst air pollution,” he said. “According to one Financial Times report, the situation in India is worse than it ever was in China, and the government is struggling to introduce measures to combat the problem.”
The Henley report noted that the UAE was one of the most popular destinations for millionaires from around the world, including India. The UAE is expected to attract 6,700 millionaires in 2024, more than any other country.
“This should not come as a surprise, as the UAE has been a top contender in attracting private capital and talent for quite some time,” Philippe Amarante, head of the Middle East division at Henley & Partners, said.
“However, since investment-based migration is increasingly driven by a confluence of economic, geopolitical, and domestic social factors, the UAE provides a reliable, safe, and appealing environment for high-net-worth families,” he added.
Amarente further said that the UAE’s “economic resilience, favourable tax policies, and world-class infrastructure” added to the existing advantages of a strategic location and political stability to make it an ideal destination for global wealth and investment.
“There are multiple reasons behind the UAE’s attractiveness, such as premium real estate, investor-friendly frameworks, large industrial announcements, and a highly sought-after residence by investment initiative, or golden visa,” he said.
(Edited by Mannat Chugh)
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