Over 4,000 millionaires could still leave India in 2024 — but the drain is getting slower year-on-year

Bucking the global trend, millionaire migration out of India is showing signs of slowing down. While a projected 4,300 high net-worth individuals (HNIs) are still expected to leave in 2024, this number is a significant decrease compared to previous years. But what's driving this exodus in the first place, and why might it be softening?

'Millionaires' or 'high-net-worth individuals' refer to people with an investable USD 1 million or more wealth. A new report by Henley & Partners paints a picture of a world where these millionaires are increasingly on the move. Political instability and economic jitters are prompting millionaires and billionaires to seek greener pastures. This trend, the report suggests, could significantly reshape how global wealth is distributed in the coming years.

According to reports, India is home to roughly 3,26,400 millionaires and around 4,300 of them are expected to migrate out of their homelands this year. This puts India among the top three countries with the most millionaires leaving, including China and the United Kingdom.

The reason for this split seems to be a desire for a better lifestyle. As Hannah White, director of the Institute for Government, points out in the report, Indian millionaires are looking for an improved quality of life when they leave the subcontinent. Moreover, lenient tax regulations in some countries could also a pull for some millionaires who aim to preserve and grow their wealth faster.

As is the case with millionaires in other countries, Indians seem to be preferring the United Arab Emirates. The UAE has a zero income tax policy for individuals, and it levies just a 5 per cent value-added Tax on the purchase of goods and services, making it a top destination for millionaires with a projected inflow of a staggering 6,700 HNIs in 2024.

Other popular choices include Australia, Singapore, the US, and Switzerland. These countries offer a combination of factors that are increasingly important to the wealthy: political stability, low taxes, excellent education systems, and a higher quality of life.
India is not a lost cause
Tracking these HNI migration patterns, the report highlights two subtle differences between India and other countries. One, unlike their counterparts elsewhere, departing Indian millionaires often maintain economic ties with their homeland. We can’t help but wonder if this has something to do with our sentimentality or if it's just a practical decision.

Second, the number of HNIs migrating out of the country is actually decreasing in comparison to previous years! India, which has historically seen higher numbers of wealth exodus, is expected to experience a decline in HNWI migration compared to the 5,100 in 2023, which was again lower than the net outflows of 7,500 individuals in 2022.

As per experts, when lots of rich folks start moving around a lot, it might suggest the economy is on its way to taking a nosedive. And this is probably why the projected decline in millionaire migration out of India could be a positive sign. While the country is still losing wealthy individuals, the slowdown suggests a potential improvement in the factors that were driving them away in the first place.

Traditionally, factors like low taxes, economic opportunities, and political stability were the biggest draws for migrating millionaires. However, the new report suggests that priorities are evolving. Quality of life, educational opportunities for children, and resilience to climate change are now equally important considerations. Additionally, the ability to protect wealth for future generations is a growing concern.

Whether this trend of millionaire migration continues to devolve in India mostly hinges on the government’s ability to address these concerns.