High net worth individuals in India reach 83k mark

New Delhi, Oct 9: Buoyant economic conditions and robust domestic stock market performance saw the number of High Net Worth Individuals (HNWIs) in India reach 83,000 mark in 2005, up 19.3 per cent from 2004, second highest rate of growth in the world.

During the year, Indian HNWIs held 290 billion dollars in assets, which represented 3.8 per cent of total Asia Pacific HNWI wealth, according to the first 'Asia-Pacific Wealth Report' published by Merrill Lynch and Capgemini.

HNWIs are people with net financial assets of at least one million dollars, excluding their primary residence and consumables.

''Economic conditions have remained robust in India with an impressive GDP growth rate and strong performances in the industrial and service sectors,'' Merrill Lynch Global Private Client Head (India) Rahul Malhotra said.

Interestingly, NRIs living in other countries in the Asia Pacific Region, say for example Singapore, were wealthier than the domestic population.

The report also found that only 0.01 per cent of India's adult populations were HNWIs, which was below the Asia-Pacific average of 0.1 per cent, showing significant potential for growth in the number of HNWIs.

It covered eight key markets in the Asia-Pacific Region, namely, India, China, Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan, which together costitutes 89 per cent of the region's GDP and HNWI population.

India, South Korea, Indonesia, Hong Kong and Singapore had the world's fastest growing HNWI populations last year, the report found.

The number of HNWIs in the Asia-Pacific region grew 7.3 per cent in 2005 to 2.4 million. The number of Ultra-HNWIs grew 12.1 per cent, to 15,600 over the same period, suggesting a further concentration of wealth.

The total combined wealth of the Asia-Pacific region's HNWI population was 7.6 trillion in 2005, an increase of 8.0 per cent over 2004.

Indian HNWIs shared the fourth highest average net worth in Asia, with South Korea, at 3.5 million dollars per person. Hong Kong led the region with 5.3 million dollars, followed by China's 5 million dollars and Singapore's 4.7 million dollars. The average for Asia-Pacific HNWI's net worth was 3.2 million dollars.

''The future of the global wealth management industry lies within Asia. As home to some of the world's fastest-growing economies, Asia presents exciting growth opportunities for wealth management providers,'' said Mr Raymundo Yu, Chairman of Merrill Lynch Asia Pacific Region and Head of Merrill Lynch Global Private Client EMEA and Pacific Regions.

The report forecasts Asia-Pacific HNWIs' financial wealth to reach 10.6 trillion dollars by 2010, growing at an annual rate of 6.7 per cent and outpacing the forecast global rate of 6 per cent.

Last year also marked the first time that Asia Pacific surpassed Europe as the second most popular destination for global HNWI investments, accounting for 23 per cent of total assets. North America continued as the most popular investment destination for the world's HNWIs, with 44 per cent of total assets.

According to the 10th Annual World Wealth Report, released in June this year, the number of HNWIs globally increased 6.5 per cent to 8.7 million, while their combined wealth rose 8.5 per cent to 33.3 trillion dollars as at the end of 2005.

UNI