All Eyes on Mumbai’s Millions

It’s official. Mumbai has been ranked the richest city in India, with a total wealth of AUD1.008 trillion according to a report recently released by global market research group New World Wealth in South Africa. With super cash injections from China over recent years, India is fast becoming a foreign direct investment powerhouse.

By Jagdish Kumar

Among forty global cities, Mumbai is ranked 11th in the ‘future wealth’ category, ahead of Chicago, Sydney, Paris, Seoul and Dubai according to the New World Wealth Report. Globally, India is now ranked in sixth position after the USA, China, Japan, Germany & UK, with its total wealth now estimated to be AUD8.173 trillion as at December 2016.

On the City Wealth Index, Mumbai ranks 21 ahead of Toronto, Washington DC and Moscow, while Delhi ranks at 35.

With recent strong foreign direct investment from Israel, Africa and China in predominately heavy industry manufacturing, e-commerce start-ups and a smoking-hot commercial property market, the report says India is expected, for the next decade, to be pivoted towards exponential growth, particularly in local financial services, IT, real estate, healthcare and media sectors. In addition, local hospital services and health insurance sectors are expected to grow strongly. Hyderabad, Pune and Bangalore are expected to lead the pack in terms of overall wealth creation in India.

According to global property giant Knight Frank, India has around two percent of the world’s millionaires (13.6 million) and 5 percent of the world’s billionaires (2,024). Total High Net Worth Individuals (HNWI) – which refers to individuals with net assets of AUD1.3 million or more – accounts for a whopping 264,000 millionaires and 95 billionaires in India alone. To put Mumbai in perspective, it has over 46,000 millionaires and 28 billionaires followed by India’s political capital, New Delhi with 23,000 millionaires and 18 billionaires.

Most of Mumbai’s wealthy are shacking up in popular areas around Bandra, Juhu, Goregaon, Parel, Worli and Palm Beach Road, while in Delhi they are located at Westend Greens, Dera Mandi, Greater Kailash and Lutyens.  The report found that spending habits have not been frugal, with extensive spends in collectables, prime real estate, second homes, travel, private jets, luxury clothing and super cars.

During the last decade, millionaires in India rose 290 percent. During this period, around 5,000 new millionaires were added to the list. Over the next decade, it is likely to increase to 1,000 per year. The continued spike in wealth has seen emerging cities grow in demand, including: Surat, Ahmedabad, Visakhapatnam, Goa, Chandigarh, Jaipur and Vadodara.

According to India’s Economic Times, Chinese enterprises have expanded their presence in India over the past five years, with one of China’s largest Banks, the Industrial Commercial Bank of China, setting up a special team in its Mumbai branch in 2015 to provide Chinese clients with consultation services for mergers and acquisitions in India.  Indeed, China’s property giant Dalian Wanda Group announced in January last year that it would spend AUD16 billion in building an industrial park in North India.

With China’s President Xi Jinping investing over AUD1.634 billion already since mid-2016 (a six-fold increase over the past four years), and a further pledge to invest AUD26 billion in India’s commercial and manufacturing sectors, combined with a relaxing of India’s visa and security restrictions for direct investors to China, India is emerging as a super global powerhouse of foreign direct investment opportunity.

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