India has more rich households than most European nations

Monday, 10 October 2011 00:00 - - {{hitsCtrl.values.hits}}

LONDON NEW DELHI: India, the world's second most-populous country, has more wealthy households than most European countries, including Germany and France.

The country, with 3 million affluent households, is fast emerging as a serious centre of affluence along with China, says the largest ever global affluence study by research firm TNS. "India and China have already surpassed major European markets like Germany and France.

It's interesting to see that the entrepreneurial spirit of people in these markets is already paying off in terms of personal wealth," TNS Director, Business and Finance, Reg Van Steen said.

TNS's Global Affluent Investor study-which interviewed 12,000 people across 24 markets including China, Brazil and India-defines affluent households as those with more than $100,000 (around Rs 50 lakh) surplus to invest. Also, the rich is getting richer.

India is among the top five countries where the affluent have more than $1 million to invest on average, alongside the UAE, Singapore, Hong Kong and Sweden.

The study vindicates aggressive expansion plans of luxury players ranging from carmakers Mercedes Benz and Jaguar Land Rover to fashion houses Hermes and Louis Vuitton to watchmakers Tag Heuer and Fendi in the country.

According to a recent CII-AT Kearney report on luxury, the Indian luxury industry is expected to grow 25% a year to $14.7 billion by 2015 from an estimated at $4.76 billion in 2009. While the count of the affluent is growing fast in the country, the rich still represent just about 1% of the population, says TNS study.

In China, too, only around 1% households are wealthy, while it is 27% in the US, the world's richest country with 31 million affluent households. As much as 80% of the world's rich households still live in the West, according to the first comprehensive study in the post-recession era.

It finds a wide disparity in the age, make-up and investment preferences across regions. For instance, the average age of the super-rich drops as it moves east, from about 57 years in the North America and Europe to about 40 in Hong Kong and Australia.

Men remain the primary decision makers in India (taking 80% of investment decisions) and Central Europe (79%), while in the US, women take 55% of investment decisions among the wealthy.