India's rich list shrinks by 37%

The meltdown in the global financial markets has taken its toll on India, with the country’s rich list shrinking by 39,000 high net worth individuals, according to Merrill Lynch Wealth Management and Capgemini’s annual World Wealth Report.

“The total number of HNIs in India has dropped to 84,000 at the end of 2008. A year prior to that the HNI strength in the country was 123,000," said Pradeep Dokania, head-global private client, DSP Merrill Lynch. This means, the number of HNIs is in the country dropped by 32 per cent.

This drop also puts India as the second-worst performer, just behind Hong Kong, if the growth of HNIs in Asia Pacific countries is taken into account. As per last year’s report, India had witnessed the fastest growth of HNI numbers in 2007.

The wealth of the world’s rich people dropped 19.5 per cent to $32.8 trillion in 2008, shrinking the global HNI population by 14.9 per cent to 8.6 million. Merrill Lynch and Capgemini define HNIs as those individuals who have net assets of at least $1 million, excluding their primary residence and consumables. The report also stated that those with net asset of $30 million or above, again, excluding primary residence and consumables, are ultra-HNIs. And this population suffered the most, globally. The number of ultra HNIs fell 24.6 per cent.

“The unprecedented declines wiped out two years of robust growth in 2006 and 2007, reducing the HNI population and its wealth to below the levels at the close of 2005,” the report observed.

But this shrinkage is set to change, once the global economy recovers. The two researchers believe global HNI wealth will grow to $48.5 trillion (from the current $32.8 trillion) by 2013.