Affluent citizens of India are leaving India. According to Global Wealth Migration Review, 2% of those with a valuation of 1 crore Rupees have left India.
Henley and Partners claim that in 2020 vs 2019, 63% more Indians enquired about leaving the nation.
However, due to the curbs on international air travel and lockdown restrictions, processing of the documents has slowed down. In 2020, about 5,000 – 6,000 wealthy people left India.
However, this number may increase rapidly in 2021.
According to sources, the number of enquiries has increased in the second wave of COVID. In 2021, more affluent people may leave the country.
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Earlier, between 2015 and 2019, more than 29,000 rich individuals gave up their Indian citizenship.
According to the report by Henley and Partners, Indians enquired the most about Canada, Portugal, Austria, Malta, Turkey, the USA, and the UK. This indicates that more Indians are looking for their way out of the nation.
Crores required to move abroad
There are two primary ways to move abroad. By making a massive investment in a specific country migration there can be arranged; or there are some nations where a huge one-time fee can be paid to buy citizenship. Most Indians prefer the former option.
For example, to settle in America, Indians require Green Visa. For this, investment of Rs 6.5 crore is required. England requires 18 crore Rupees of investment, New Zealand requires 10.9 crore of investment. There are some nations like Saint Kitts and Nevis; and Dominica where relatively lesser investment of up to Rs 72 lakh gets you the citizenship.
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Why the rich are leaving India? Difficult business environment, healthcare, pollution, tax, and property litigations
Rajkumar Sablani, who migrated from Chhattisgarh to Jamaica told a national daily that in India there is a lack of opportunities, political instability, corruption, pollution, and related problems which force a person to leave the nation. He claims that he left India for these reasons.
Writer Vivek Kaul claims that those who leave India do not take their entire business from here. Instead they stay for a few months abroad to qualify for the legal title of NRI (Non Resident Indian), and this then eliminates corporation tax on them.
Nibhay Handa, Director, Henley and Partners reveals that moving to another nation does not only mean buying a house there. With this action, the assets and liabilities of the person come under two legal jurisdictions. In the case of dispute, the multiple jurisdictions reap huge benefits as the law of both the nations need to be honoured now.
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Drawbacks of the rich leaving India: Reduction in tax collection and in jobs too
India’s employment rate is already barely adequate. In this scenario when the rich take their business elsewhere, the unemployment rate here increases.
Due to this, the gap between the rich and the poor will increase. The wealthy leave the country to save huge amounts of tax. This action reduces the amount of tax collection and hurts the economy of the nation.
On the other hand, in nations like Singapore, Hong Kong, Britain, Korea, the system of taxation is very simple. Thus, people leave their own nation and move to these countries to establish their business.
However, a dispute is underway on social media regarding Indians leaving their nation. Three primary rationales are being put forward for this:
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1. People want to do business. However, the government and the circumstances of the country are not able to provide reasonable opportunities to them. Thus, in search of business, they move to those countries where tax rules are easier.
2. People are moving from here in search for a better life. They have money, and they believe that healthcare, security, and education opportunities are better there than in India. Thus, they do not want to stay here.
3. These people have done illegal activities in taxation etc to earn money. They are under fear of being caught here. Thus, they are fleeing from the nation.