Indian Wealth Management Opportunities in Uncertain Times

The protection of hard-earned wealth becomes as important as its accumulation in uncertain economic times.

Indian entrepreneurs are now fabled across the globe as wealth creators. According to the '2020 Foresight: Non-Resident Indians 2013' market research report, the population of NRI millionaires stood at a whopping 180,000 in 2012.

The US accounted for the largest proportion of NRI millionaires, followed by the UK, the UAE, Canada, Hong Kong, Singapore and Indonesia. The value of the worldwide wealth management market for NRIs was estimated at $634 billion in 2012 and this value is expected to increase to $1 trillion by 2017.

These are impressive figures but also imply a greater need for astute and culturally sensitive wealth advisory services.

It is reflective of a major modern-day trend among Indians owning assets across multiple jurisdictions, which throw up their own legal and compliance complications. For instance, the concept of 'Domicile' under UK law has certain advantages for Indians who have UK and Indian assets. Under the UK-India Double Taxation Avoidance Treaty, the UK permits an exemption from inheritance tax to UK residents of Indian origin domiciled in India. Such provisions can be hugely helpful to people of Indian origin in planning their tax affairs.

Property is an important asset class and has always been. According to property experts, Indians have - along with Russian and Chinese investors - fuelled the property boom in London over recent years. But as generations change, and times change, this is leading to a diversification into different and innovative asset classes such as wine, art, and other collectibles. We cover this as part of the Global Wealth Management Conclave's special session on Luxury Assets. With each community, whether Indian, Chinese, European and their sub-communities, the management of wealth is not merely about conducting financial transactions. It is about understanding cultural underpinnings and the role played by the family. Indeed the definition and treatment of “family” in Indian culture is much different to that in the West.

We delve into these varied aspects through the eyes of some experts in this edition with articles such as Realty Corner by Deepak Varghese, The Future of Off-Shoring by Michael Shimmin of the Fedelta Group and Future Proofing Family Wealth by Anup Dalal of Salvum Advisors. Wealth creation is uniquely celebrated in Indian society and has a strong historic and religious connect reflected in practices such as the worship of the Goddess Lakshmi during the festival of Diwali.

But ultimately what is done with wealth and how it benefits society is, in my view, the true test of a socially conscious society.

I am therefore pleased that at India Inc we have made it a tradition to try to associate our activities with good causes. I am pleased that we are through this issue of the India Investment Journal supporting the wonderful work in wildlife protection by the David Shepherd Wildlife Foundation.

Manoj Ladwa is the Chief Executive of India Inc.

The above article was published in India Inc′s print edition of the India Investment Journal launched in April 2014 in conjunction with the Global Wealth Management Conclave 2014.