Global Indian Wealth under the scanner

01-May-2015 #IIJ,#Globalwealth Source: India Inc

by Manoj Ladwa

The phrase ‘global economic crisis’ sounds so clichéd nowadays. But its very real effects and consequences continue to be felt today.

Perhaps the most important impact (and in my view, rightly so) has been the tightening up of lax regulations that govern how financial decisions are made and funds flow – both in domestic markets and globally.

But the question now is, for instance in the UK, are we going a step too far? The sustained targeting of Non-Doms is one such example. Similarly, in India the debate on whether the state should levy death taxes continues and annually when the Indian Finance Minister stands to deliver the Union Budget the question of “will-he or won’t he” is always on the minds of accounts, economists and wealth managers.

The combined effect of the UK’s hardening position on the Non-Domicile criteria and India’s necessary quest to increase the tax net, both via more regulation and aggressive enforcement, means that members of the Indian diaspora with assets in both the UK and India face a real conundrum. And this is not just a dilemma for the ultra- rich.

Many, if not most, UK Indians who would not otherwise be considered as high net worth (HNI) now have assets in both jurisdictions. The challenge for professional advisers – accountants, lawyers, bankers, wealth mangers – is how they can respond to what will inevitably be an increasing demand for truly joined-up advisory services. To borrow Prime Minister Modi’s catchphrase for dealing with big problems: there is now a pressing need for professionals to demonstrate their ‘Skill, Scale & Speed’ in plugging this gap. Indeed the gap should be seen as a major opportunity.

Another high-profile campaign of the now-established Modi administration is the drive to bring back “black money” – unaccounted for money sitting in off- shore and low tax jurisdictions outside India. This is a noble campaign and one of the key manifesto pledges of the ruling Bharatiya Janata Party (BJP).

The consequences are inevitably greater scrutiny of the assets of global Indians as India seeks cooperation and joint initiatives with other governments. Such is the intensity of Modi’s commitment, he raised this issue at the G20 meeting in Australia a few months ago asking for support on what he describe as a “global problem”. I wonder how off-shore jurisdictions will respond to Indian money.

In this issue of the ‘India Investment Journal’, we have picked from a broad range of some of these pressing issues. The Non- Dom tax status is explained and laid bare as it stands (Page 10) and that ubiquitous element within the GlobalI ndian context of Family Businesses is analysed (Page 18). We put across some straight questions to the Indian Finance Minister, Arun Jaitley, on the course of the economy (Page 20) and sit down for a chat with perhaps one of the most famous Global Indians, Ratan Tata (Page 26).

This issue of India Inc.’s ‘India Investment Journal’ coincides with the second instalment of our flagship Global Wealth Management Conclave. And given the backdrop of the UK elections and the Indian government’s drive for greater scrutiny of global Indian assets, the conclave is very timely.

I am grateful in particular to global consulting firm BDO, who have partnered with us for the second year running, as well as Jersey Finance and Punjab National Bank for their support in putting Global Indian wealth management under the scanner.

Manoj LadwaManoj Ladwa is the founder of India Inc. and chief executive of MLS Chase Group @manojladwa

 

 

 

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The above article was published in India Inc‘s print edition of the India Investment Journal launched in April 2015 in conjunction with the Global Wealth Management Conclave 2015.

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