According to Sudhir Kapadia, national leader-tax at EY India, “the steady flow of wealthy Indian migration to another country or residency in another country can be an issue for India as it prepares to reach the $5 trillion economies.” “We raise the number of days from 120 to 180 to be an Indian citizen as one of the ways we entice more HNIs to continue with Indian citizenship.”

According to a recent study, India would be one of the top three nations to see an outflow of the rich in 2022 with an estimated 8,000 millionaires leaving.

According to the Henley Global Citizens Report, 2022 Q2, the main reasons people migrate are the desire for a higher standard of living, better educational and medical facilities, and a desire to avoid India’s strict tax residence law and high rate of individual tax.

According to the survey, many young entrepreneurs are looking into international business and investment opportunities while exhibiting an ever-increasing stomach for risk. According to the report, the number of millionaires and billionaires earning in US dollars would increase by 80% in India over the next ten years, but only by 20% in the US and 10% in France, Germany, Italy, and the UK.

But why are India’s richest people migrating to other nations?

A new generation of tech entrepreneurs is joining the ranks of the old industrialist base, seeking to diversify a portion of their income in nations that offer the majority of benefits and low tax rates.

The appeal of a higher level of living, which includes superior family-oriented educational and medical resources, also remains a significant motivator, maybe even more so in the wake of Covid 19.

“Increasingly strict tax residency regulations (implemented in 2020 and 2021) with no reduction in individual tax rates for HNWIs, together with a desire for visa-free travel, are also recurring main drivers for alternative residence and citizenship,” according to research.

To where are Indians migrating?

Indians are becoming more interested in traditional favorites Dubai and Singapore as well as EU nations.

While Singapore is a preferred location for family offices and digital entrepreneurs because of its strong legal framework and easy access to top-notch financial advisors, the Dubai Golden Visa has gained popularity in some circles because of how simple it is to obtain and the variety of options it offers.

According to the most recent estimates for 2022, India would lose about 8,000 millionaires this year due to net inflows and outflows of US dollar millionaires (the difference between the number of high nets worth individuals who move to and the number who exit from a country).

Given that India produces far more new millionaires each year than it loses to migration, these outflows are not particularly concerning. Wealthy people have a propensity to return to India, and whenever the nation’s standard of living rises, we anticipate that they will do so in greater numbers.

The Henley Private Wealth Migration Dashboard predicts that in 2022, the UAE will see the largest net inflow of HNWIs worldwide (at least 4,000).

Behind Australia (3,500), Singapore is placed third, and this year is expected to have a net inflow of 2,800.

Switzerland is placed first with a score of 2200, followed by the United States with a score of 1500, while Israel is ranked fourth on the list with a score of 2500.

Destinations that have good infrastructure for preserving wealth are likely to remain in demand.

Indians face difficulties such as strict exchange restrictions for sending money abroad, inheritance taxes for assets held abroad, and Indian residence laws that target statelessness. Indians are becoming more and more dependent on legal and financial professionals for sophisticated guidance on overcoming these challenges through the use of private trusts, holding entities, distinct wills for various jurisdictions, and other strategies.

Others looked to Europe, especially the Mediterranean nations like Portugal, Malta, and Greece, as they provide a route into the EU, a high standard of living, and, in most cases, a low physical residency requirement—all of which are significant factors for those who want to keep their families or businesses in India.