New rich of India

Even specialised Swiss banks like Credit Suisse have been quick to tap the NRI market.

"Credit Suisse has built dedicated teams across the major centres in Dubai, London, Singapore and Zurich, catering to the needs of non-resident Indian clients," explains Rajan Sehgal, who runs the bank's NRI group in the Middle East.

"Non-resident Indian clients not only invest in the local markets but also in Indian onshore assets - for example in 2005 there were US$1.5bn in NRI investments in Indian mutual funds," he says.

Four of the top eight billionaires in the world are from India according to the 2008 Forbes Rich List, and four Indian women have powered their way onto the list. The eight are led by steel tycoon Lakshmi Mittal, estimated to be worth US$45bn by Forbes. He is followed by the Ambani brothers and KP Singh, the real estate investor.

India's millionaire population grew 20% last year, to about 100,000 - or more than twice the rate of growth of millionaires in the US, according to a report from Merrill Lynch/Cap Gemini.

The burgeoning affluence of members of the NRI community may be partially attributable to a spillover effect from the Indian economic boom. India's economy currently ranks 12th in the world, with a GDP of US$1.25 trillion.

As one of the 'BRIC' emerging markets (Brazil, Russia, India, and China), it trails closely on the heels of China as the second fastest growing major economy in the world.

The expansion of Chinese and Indian economies is credited with fuelling growth in Asia-Pacific markets as wealth continues to rise along with the population.

The global Indian population is characterised by a younger age group with years of work ahead, contributing significantly to the creation of wealth among residents and expatriates over the last five years.

India has left its mark on the global trading platform with major trading partners including the US, UAE and a number of OPEC countries.

India is also garnering much attention from high net worth individuals around the globe as a rapidly growing economy, and most are scrambling to get a piece of the action through direct foreign investment.

A number of mutual funds have been created over the last few years aimed at investments in various sectors of the Indian economy, and in turn, it is increasingly becoming common for banks to hire Indian product specialists to keep up with the pace.

A survey by Goldman Sachs predicts that India will become the world's largest economy by 2035. India sustained a real GDP growth rate of 9.6% in 2007, marking it as "one of the highest of any economy in the world," as recounted in the last Merrill Lynch World Wealth Report.

GDP growth was led by an increase in industrial production and a sizeable expansion in the services sector. The accelerating pace of real GDP growth rates in India continues to lead emerging markets in outperforming the rest of the world, which has a positive effect on wealth creation in those particular economies.

"Initial steps were taken within India itself," says Niazi at ABN Amro, "But it is the NRIs who lit the economic fuse in India and started to invest in the key industries. NRIs went into India in the last 15 years or so and made lots of money in various businesses and now have a need to be part of the growth story of the UAE."

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