![]() ![]() The number of millionaires in the country has shot up from 170,000 in 2010 to nearly 700,000 in 2020, according to Credit Suisse. The increase in total overseas investments by Indians is not entirely surprising, according to Joseph Thomas, head of research at Emkay Wealth Management, a Mumbai-headquartered financial planning firm. The government of India has caps on how much money Indians can invest or send abroad Investments beyond Indian borders “This can’t be good for India,” said Ranjan to Al Jazeera. It also undermines India’s pitch as a country that the rest of the world should invest in. But this exodus of wealth reduces the pool of investments that could otherwise have been made in India and shrinks potential tax collection. The outflow of money and millionaires is being driven by factors ranging from the desire to diversify investments geographically to the search for boltholes after the COVID-19 pandemic, said analysts. That ban was lifted in June, but experts expect the relief to be temporary since the cap remains the same.Īnd rich Indians are not just sending their money abroad: 8,000 Indian millionaires are also expected to pack their bags and move elsewhere this year, only outnumbered by wealthy Chinese and Russians, according to investment migration consultancy Henley & Partners. So much so that in February, the Securities and Exchange Board of India, the country’s stock market regulator, banned new investments abroad through Indian mutual funds amid fears that a $7bn industry cap would be breached for the first time. The country’s own mutual funds have also increasingly sought to invest their customers’ money overseas. ![]() That is almost 40 percent higher than the figure for 2020-21 and nearly six times the $292m that Indians invested abroad in real estate, deposits, debt and equity in 2014-15, when the current government of Prime Minister Narendra Modi came to power, promising to turn the country into a magnet for global wealth. In the 2021-22 financial year, Indians ploughed $1.69bn directly into foreign bank deposits, equity and debt instruments, and buying property outside the country, according to the Reserve Bank of India (RBI). Wealthy Indians are investing abroad at record rates, data from the country’s central bank reveals. They confirmed: they too were receiving similar guidance. Then, Ranjan called his friends to check what their advisers were telling them. “I couldn’t believe what they were saying, so I asked them to repeat it,” he recalled. But earlier this year, the advice changed dramatically: Ranjan, they said, should invest 20 percent of his portfolio outside India. For years, financial advisers had recommended only homegrown investment options to the Indian tech entrepreneur and angel investor.
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