India is observing a spree of migration of millionaires at an alarming rate and is listed among top among countries registering high rate of millionaires migration followed by France and China.
On the other hand, Auckland, Dubai, Montreal, Tel Aviv and Toronto are rated as the most popular destinations for the world’s high net worth individuals. However, for Indian high net worth individuals UK, Dubai and Singapore are likely the most popular destinations to migrate.
Since 2014, there is a tremendous upsurge in the migration of Indian Millionaires to other nations. According to official reports, in the last 4 years 23,000 (7000 in 2017 alone) millionaires migrated to other countries from India.
India millionaire migration rate is registered at 2.1% compared to France (1.3%) and China (1.1%).
Millionaires are defined as those persons with net assets of more than $1 million, working and living in the country.
During the survey of millionaires’ migration – millionaires who have physically moved and spend more than six months outside the country are deliberated and those who have residences outside the country but have not moved are excluded.
The predominant reason for the millionaires’ migration are contemplated to be – India (Government war on black-money), France (highest tax rate) and United Kingdom (decision to leave European Union).
Tough tax laws, anti-black money drive, crackdown on corruption and non-performing loans are also the causes that contributed to the upsurge in Indian millionaire’s migration.
Indian government provided an opportunity to people holding unaccounted foreign assets to come clean through a disclosure scheme. This might also have triggered the fear psychosis in the mind of the Indian millionaires forcing them to migrate out of the nation.
Many millionaires could also be leaving India for tax advantage, better governance, quality of life, etc. As a result, India loses existing and potential industrialists, employment opportunities that these people could have generated in India as well as their consumption in India.
Indian government’s efforts to curb the menace of black money is the need of the hour to cleanse the corrupt driven system in India but at the same time it is equally important to monitor the side effects of such labors.
It is high time for government to take curative measures to thwart migration of Indian Millionaires – the fraudsters should be allowed and genuine ones should not feel the need to. It may lead to other countries deriving economic benefit and hindering the overall economic development of India.
Bhumesh Verma, is a Corporate Lawyer with over 2 decades of experience in advising domestic and international clients, with a place in “The A-List – India’s Top 100 Lawyers” by India Business Law Journal. He keeps writing frequently on FDI, M&A and other corporate matters. With Research and Inputs by Paruchuri Baswanth Mohan