The recently published World Wealth Report 2023 by Capgemini indicates a significant decrease in the global number of High Net Worth Individuals (HNWIs). This year’s decline in both the quantity and wealth of HNWIs is the highest recorded in the past decade.
However, amidst this negative trend, the report highlights positive news for India, specifically focusing on the country’s impressive performance in the stock market.
Key findings from the World Wealth Report 2023 reveal that the wealth of HNWIs has diminished over the past year due to various factors such as geopolitical crises, market downturns, rising living costs, and unexpected inflation. Global economic conditions have been further strained by the increasing interest rates set by central banks.
The corporate sector, particularly technology stocks, has faced earnings setbacks.
According to the report, global HNWIs’ wealth has declined by 3.6 percent to $83 trillion in 2022, marking the most significant dip between 2013 and 2022. Both diversified investment instruments and equity have experienced declines in HNWIs’ wealth. Additionally, the number of HNWIs has decreased by 3.3 percent, reaching 21.7 million in 2022.
Notably, North America witnessed the steepest decline. In terms of affluent individuals, North America (46 percent) and the Asia-Pacific region (32 percent) contribute the largest share of global wealth value and population size.
The report also reveals that despite holding approximately $27 trillion in assets, which represents nearly 32 percent of total HNWI wealth, about 34 percent of firms are not fully exploring the potential of this affluent segment.
In contrast, the report brings positive news for India. Alongside Indonesia, India had a successful year in the Asia-Pacific region. India’s stock market displayed notable growth over the past year, with the BSE Sensex recording a year-on-year gain of 4.4 percent and Nifty 50 gaining 4.3 percent. Furthermore, there has been a relative increase in both the wealth and population of HNWIs in India.
The previous year’s Capgemini report, based on 2021 data, highlighted a growth of 10.5 percent in the HNWI population in India. This growth resulted in a total of 308 Indians entering the ultra-rich category. Globally, in 2021, the number of HNWIs increased by 7.8 percent to 22.5 million, with an 8 percent rise in their overall wealth.
India’s resilience in the face of the global decline in HNWIs demonstrates the country’s robust stock market performance and underscores its potential as a favorable destination for wealth creation and investment opportunities.
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