House­hold wealth rises 10% to $5 tril­lion

Business Standard - - BRAND WORLD - SAMIE MODAK

India’s house­hold wealth in­creased 10 per cent to $5 tril­lion in the one-year pe­riod to mid-2017, says a Credit Suisse re­port.

Ag­gre­gate global wealth for the pe­riod in­creased by 6.4 per cent to $280 tril­lion. “Fluc­tu­a­tions in as­set prices and ex­change rates ac­count for much of the change in house­hold wealth across re­gions and coun­tries in the short run,” the re­port said.

India’s mar­ket cap­i­tal­i­sa­tion has risen 30 per cent, house prices by around 10 per cent and the ru­pee has ap­pre­ci­ated by four per cent against the dol­lar dur­ing the pe­riod un­der con­sid­er­a­tion. As a re­sult, India’s wealth grew by $451 bil­lion, the eighth largest wealth gain glob­ally.

Since 2000, wealth in India has grown 9.2 per cent per an­num, faster than the global av­er­age of six per cent even when tak­ing into ac­count pop­u­la­tion growth of 2.2 per cent an­nu­ally, said the bro­ker­age.

Credit Suisse fore­casts do­mes­tic house­hold wealth to grow by 7.5 per cent an­nu­ally to reach $7.1 tril­lion in 2022. Wealth per adult was es­ti­mated at $5,980 in mid-2017, an in­crease of 7.9 per cent, and av­er­ag­ing seven per cent growth over 2000–2017.

Per­sonal wealth in India is dom­i­nated by prop­erty and other real as­sets, which make up 86 per cent of es­ti­mated house­hold as­sets. Per­sonal debts are es­ti­mated to be just nine per cent of gross as­sets. Over­all house­hold debt as a pro­por­tion of as­sets in India is lower than in most de­vel­oped coun­tries.

“While wealth has been ris­ing in India, growth re­mains un­even, with 92 per cent of the adult pop­u­la­tion hav­ing wealth be­low $10,000. Due to the large pop­u­la­tion, 4.4 mil­lion adults or 0.5 per cent have net worth over $100,000,” said Credit Suisse in its Global Wealth re­port.

“The num­ber of mil­lion­aires grew 21.3 per cent to reach 245,000 in mid-2017, own­ing $988 bil­lion in wealth; among them, UHNWIs (ul­tra high net worth in­di­vid­u­als) grew by 41.5 per cent to 1,820, ranked 14th glob­ally, while the num­ber of bil­lion­aires in­creased by 56 per cent to 42.” The re­port fore­cast India’s mil­lion­aires to reach 372,000 in 2022, an in­crease of more than 50 per cent, or 8.7 per cent an­nu­ally in the next five years.

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