Over 1.63 lakh Indians gave up their citizenship in 2021 alone with most people settling in the US, as per the data tabled by the Ministry of Home Affairs in the parliament last week. More than 3.9 lakh Indians have given up their citizenship in the last three years, according to the ministry's reply in the Lok Sabha.
While migrating for jobs and studies is quite common, among those who are relocating are also high net-worth individuals (HNIs). Yes, wealthy or super rich Indians are also opting to leave the country.
According to a research report by Henley & Partners (H&P), a UK-based global citizenship and residence adviser, about 8,000 HNIs are expected to leave India this year.
Source: Henley & PartnersIndia has the third highest number of HNIs expected to leave the country this year after Russia (15,000) and China (10,000). While, UAE is expected to attract the highest number of HNIs at 4,000 this year, Australia will attract 3,500 and Singapore 2,800.
Projected net outflows of HNWIs 2022
| Russian Federation | 15,000 |
| China | 10,000 |
| India | 8,000 |
| Hong Kong (SAR China) | 3,000 |
| Ukraine | 2,800 |
| Brazil | 2,500 |
| UK | 1,500 |
| Mexico | 800 |
| Saudi Arabia | 600 |
| Indonesia | 600 |
Source: Henley & Partners. *These are projected figures for the full year 2022. They are based on year-to-date HNWI movements. Numbers rounded to the nearest 100.
But what are the reasons behind these super rich Indians leaving the country?
The top most reason behind HNIs leaving India seems to be better standard of living. Among the other reasons are better educational and health facilities, political dynamics, better work-life balance and eventual citizenship opportunities, according to experts.
"Some of the top reasons why these HNIs are leaving India can be a higher standard of living, better educational and health facilities, security, political reasons, etc.," Kritesh Abhishek, Founder and CEO at Trade Brains and FinGrad, stated in a LinkedIn post.
Manoj Dhulipati, Global Marketing and Sales Analyst, based out of Germany, stated his reasons as follows:
1) Better standard of living.
2) Escape from many social stigmas.
3) Better work-life balance.
4) Opportunity to earn in an appreciating currency and invest in rupee.
5) Better travel feasibility and eventual citizenship opportunities.
Minister of State for Home Affairs Nityanand Rai had last year told the Parliament that 1,33,83,718 Indians were living in foreign countries.
As per the Global Wealth Migration Review report, about 5,000 millionaires, 2 percent of the total number of HNIs, had left India in 2020. Another 2018 report by Morgan Stanley had stated that 23,000 Indian millionaires had moved out of the country since 2014.
"Normally HNWI (or HNI) outflows are related to finding better business opportunities abroad. Also safety concerns, taxation and standard of living are major drivers," Andrew Amoils, head of research at New World Wealth, a wealth intelligence firm, told CNBCTV18.com.
However, according to Amoils, once the standard of living improves in India, many HNIs are likely to move back.
Stringent tax rules and a desire for powerful passports are among the main reasons for migration for Indians, according to Bijal Ajinky, a partner in Khaitan and Co’s direct tax, private client and investment funds practices.
“The appeal of a higher standard of living, including better educational and health facilities for the family, also continues to be a key driver, perhaps even more so in the wake of Covid,” he told the Times of India.
While many HNIs are moving out of India, the country has also seen a sharp growth in wealthy people. According to the H&P report, India was second after China in the growth of high net-worth individuals in the last 10 years at 74 percent.
HNWI growth % in US Dollar terms
| China | 88% |
| India | 74% |
| USA | 42% |
| Australia | 40% |
| Canada | 22% |
| Japan | 12% |
| Germany | 11% |
| UK | -1% |
| France | -3% |
| Italy | -9% |
Source: H&P. *All growth rates are effectively in US dollar terms as HNWIs are defined as individuals with net assets of USD 1 million or more.
Not just this, the number of HNIs in India is likely to grow at the highest rate of 80 percent by 2031, followed by Australia (60 percent) and China (50 percent.)
First Published: Jul 25, 2022 3:26 PM IST
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
Andhra Pradesh Lok Sabha elections: A look at YSRCP candidates
Apr 25, 2024 6:54 PM
Lok Sabha elections 2024: Banks and schools to remain closed in these cities for phase 2 voting
Apr 25, 2024 5:33 PM
Andhra Pradesh Lok Sabha elections: Seats, schedule, NDA candidates and more
Apr 25, 2024 5:16 PM