India records fastest growth in HNIs in 2007

India has recorded the fastest growth in the population of high net worth individuals (HNI) worldwide in the calendar year 2007-08. According to the third annual Asia-Pacific wealth report published by Merrill Lynch and Capgemini, there were an estimated 1,23,000 millionaires (HNIs) in India at the end of 2007, up 22.7% from the previous year.

HNIs are individuals having investable assets in excess of $1 million, excluding their primary residence and consumables.

During calendar year 2007-08, the combined wealth of India?s HNIs rose 25.7% to $440 billion, said the report.

The report pointed out that rapid economic expansion, increased foreign investment and gains on the country?s stock markets fueled the jump in India?s HNI population last year. Indian HNIs allocated 36% of their assets to equities, among the highest in the nine regional markets covered by the report.

?Despite dislocations in developed markets, the number of HNIs in India grew at a faster rate than the global average,? said Pradeep Dokania, head of global wealth management with DSP Merrill Lynch.

?Domestic demand and Asia?s appetite for commodities continue to drive wealth accumulation in India,? he added.

According to the 2008 report, the average net worth of Indian HNIs rose slightly to $3.6 million, compared to $3.4 million for the Asia Pacific region. The global average was $4 million.

The number of Asia-Pacific HNIs expanded to 2.8 million at the end of 2007, portraying an increase of 8.7% and exceeding the global growth rate of 6%. The region was home to 27.8% of the world?s HNI population. The report covered nine key markets in Asia Pacific namely, Australia, China, Hong Kong, India, Indonesia, Japan, Singapore, South Korea and Taiwan.

The region?s wealth held a combined $9.5 trillion in financial assets, up 12.5% from a year earlier and making up 23.3% of global HNI wealth.

For a third year, Asia Pacific dominated the list of the world?s 10 fastest-growing markets for HNIs, taking the fifth of the top spots. India led the way, followed by China, which saw a 20.3% rise. South Korea, Indonesia and Singapore posted gains of 18.9%, 16.8% and 15.3%, respectively, the report said.

The report also noted that economic growth and stock market returns were the key drivers of wealth accumulation in the Asia Pacific region last year.

?With strong fundamentals and a booming young population, India continues to accelerate ahead on the path of economic growth,? said Salil Parekh, CEO with Capgemini, India.