High net worth population rises 21%

The population of high net worth individuals (HNIs) in India grew by a whopping 20.8 per cent in 2010, according to a recently published report.

As per the Asia-Pacific Wealth Report, released by Merrill Lynch Global Wealth Management and Capgemini, India's HNI population grew to 1,53,000 in 2010 compared with 1,26,700 in 2009. "India was among the eight of the 20 fastest-growing Asia Pacific markets in HNI population including Hong Kong, Vietnam, Indonesia and Sri Lanka," the report said.

However, China remained the second-largest HNI base in Asia-Pacific behind Japan, and fourth-largest in the world, with 5,35,000 HNIs, up 12 per cent from the previous year.

HNIs are defined as those having investable assets of $1 million or more, excluding primary residence, collectibles, consumables and consumer durables.

In 2009-10, the country's HNIs' wealth grew 22 per cent to $582 billion as compared to $477 billion in 2008-09, the report said. This means the wealth of 1.53 lakh Indians amounted to Rs 28,51,800 crore.

However, there could be some impact on the rise in HNI numbers this year due to the 'high inflation, slow growth' scenario. "Inflation does impact HNIs as the purchasing power and growth rate will come down due to higher inflation," Merrill Lynch Wealth Management chairman Pradeep Dokania said.

Indian HNI investment in equities went up to 36 per cent in 2010 from 32 per cent in 2009, while real estate moved up marginally to 23 per cent in 2010 as compared to 22 per cent in 2009. India's HNIs' holdings in equities is far higher than the global average at 33 per cent. The passion investment in gems & jewellery too went up to 37 per cent in 2010 from 33 percent in 2009. Indian HNI's exposure to fixed income, alternative investments and cash/deposits is more or less at the same level ranging from 26 per cent in 2010 from 25 per cent in 2009, 6 percent in 2010 from 8 percent in 2009 and 9 percent in 2010 from 13 percent in 2009, respectively.

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