When India's rich plan to migrate to another country, most of them choose the United Arab Emirates and particularly Dubai, which is one of the Emirates.
A report by Henley & Partners, an international investment migration advisory firm, says approximately 4,300 millionaires are projected to leave India this year.
And most of them are headed to the UAE.
However, it's not that India's rich are in a hurry to leave the country.
It's only a small number of rich Indians. "India continues to lose large numbers of millionaires, especially to the UAE.
However, in our view these outflows are not particularly concerning as India continues to produce far more new HNWIs than it loses to emigration.
Furthermore, the bulk of the millionaires who leave India tend to retain business interests and second homes in the country, which is a positive sign," says the report.
Why the UAE has such a pull for rich Indians
The UAE is a bigger attraction for India's rich than other popular destinations for migration, such as Australia, Singapore, Israel, Switzerland, the US, Canada, New Zealand and the UK.
Dubai market earned 16 billion dirhams, or Rs 35,500 crore, from sales to Indians last year – which is almost double of what it netted in 2021, around 9 billion dirhams.
A sizable 40% of homebuyers were from India, the majority being from Delhi-NCR, Ahmedabad, Surat, Hyderabad and Punjab.
The remaining were Indians living in the UAE (40%), and global Indians (20%) based in different parts of the world.
There is a growing trend of affluent Indians looking at cities such as Dubai, Singapore and London to set up overseas family offices (FO).
It is often members of the younger generation, who are either studying abroad or have just returned from a foreign campus and joined business, who want to set up family offices in overseas jurisdictions.
Founders of several startups are also shifting their base to foreign countries and opening family offices there.
There are many reasons drawing them abroad
One, they want to hedge a portion of their wealth from any potential tax-related or regulatory liabilities in India.
Two, an overseas family office makes it easier to access foreign markets and grow business in other geographies.
Three, this leads to the diversification of investments and businesses.
Typically, a family office is a privately held entity, which manages investments and wealth for a family that has investable assets worth around $100 million (about `820 crore).
Besides these super rich Indians, a number of professionals too are choosing Dubai.
The Golden Visa programme – expanded in 2022 to include more workers, skilled professionals, scientists and researchers – has given an additional allure to the UAE for this new set of rich Indians.
The programme is a long-term residence visa that allows foreign talent to live, work or study in the UAE while enjoying exclusive benefits.
A cosmopolitan culture, good civic amenities, high-quality infrastructure, high standard of living, quality education, luxury shopping, world-class healthcare, and diverse entertainment options are other attractions of the UAE for the rich,
Techpreneurs make a beeline for the UAE
Lured by the ease of setting up business, complete waiver on personal income tax, and a friendlier policy environment, several of India's tech entrepreneurs have been emigrating to the UAE using the country's golden visa program, at a time when India has emerged as the third largest startup ecosystem in the world after the US and China.
Indians form over 30 per cent of the startup community in Dubai and the city wants to attract a lot more tech talent from India.
It is offering 100,000 golden visas which allow entrepreneurs and technology investors to live in the country for up to 10 years, longer than regular visas and has even set up a national small-business programme to help startups find funding, partner with established companies and market their products overseas.
How the UAE made itself more attractive for businesses
In the past few years, the UAE started to break away from a decades-old economic model that prevails across the oil-rich region, linking residency to employment.
Officials widened the eligibility net for long-term ‘golden’ visas, abolished a requirement for companies to have a majority local partner, switched to a Monday-Friday working week and made it legal for unmarried couples to live together.
Policymakers wanted to help Dubai shed its reputation of being a transient city by attracting expatriates and encouraging some of them to set up businesses.
That seems to have paid off. Authorities told Bloomberg that Dubai had 411,802 active business licenses in 2023. That’s a 30% jump from 2022 levels and a 75% increase from 2021.
As per Dubai International Financial Centre, the number of entities registered there rose 26% in 2023 from a year earlier to over 5,500. The free-zone now employs about 41,600 people — a 15% increase.
Source: https://economictimes.indiatimes.com/nri/migrate/why-are-indias-richie-rich-choosing-dubai-to-migrate/articleshow/111145455.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
