The Richie Rich Syndrome

Money and CoinsAnother report to boost out ego. We seem to be taking over the world by storm, given the footage we receive in the international media. The latest Asia-Pacific wealth report by financial servives firm Merril Lynch and consulting firm Capgemini, adds another feather in our cap.

After all, the rich in the country are getting richer and simultaneously new ones are joining them. The above mentioned study has confirmed that the number of High Net Worth Individuals (HNWI) have touched the astronomical number of 1 Lakh, at the end of the year 2006. This is a massive 20.5% increase from the last year, 2005.

High Net Worth Individuals (HNWI) are people who have financial assets which value more than $1 million, excluding there primary residence and consumables. If the financial value of the assets is more than $30 million, then the people are called Ultra High Net Worth Individuals (UHNWI). In

India, their number is an estimated 858. Nine economies in Asia-Pacific, namely, Australia, China, Hong Kong, India, Indonesia, Japan, Singapore, South Korea and

Taiwan, were home to 2.6 million millionaires. The growth of these millionaires has been the fastest in Singapore followed by India and then by

Indonesia. It is interesting to note the pattern of spending on luxury goods for these richies. Jewellery has not lost its charm in

Asia and forms a major part of the spending. Spending on antiques and wine is yet to take-off, as the proportion of money spent on this is much less than their counterparts in America or

Europe. The increase in the number of rich in

India is attributed to a high-growth economy, real estate boom and rising stock markets. It is apparent that the luxury goods market and private banking will get the much needed thrust for their development now. The situation is also a reminder to the Prime Minister, Mr. Manmohan Singh’s debatable speech made in the last CII summit in June 2007. Though the focus of the debate was the remark made by Prime Minister that CEO salaries must be curbed, which got its due share of criticism in the media, there was a rational point made which got lost down the line. The issue of Social Responsibility being handed down to the Corporates entirely, does not make sense, but the incorporation of Social Development in the Corporate mission is a structure that can be developed easily given the current state of affairs in the country.The study shows that the philanthropists in

Asia, who donated their wealth, contributed as much as 12% of their wealth to trusts in 2006, a figure much higher than their American and European counterparts. The model of Individual Social responsibility, which takes into account the willingness and ability to donate funds, can easily be developed in the country.The other face of the country is of those 34 Crore Indians who go to bed without food every night. Over 10, 000 Indians die of hunger everyday and the annual figure stands at 40 Lakhs.This remains unnoticed in the rising growth pattern with a surge in the number of rich, shown by the economy recently. It is assumed that the double digit growth of the economy’s GDP entails a rising living standard for the entire population. The build-up of this contrast goes to point that the growth has not been inclusive of development.Garima