A curious paradox is unfolding in India’s economy: while the nation’s growth engine sputters, its wealthiest citizens are on a global shopping spree. From luxury real estate in Dubai to tech startups in Silicon Valley, Indian billionaires are parking their capital overseas at a record pace. The trend signals a deepening crisis of confidence in domestic markets, even as Prime Minister Modi’s government touts a “Viksit Bharat” vision for 2047.
Data from the Reserve Bank of India reveals a 22% surge in outward foreign direct investment by high-net-worth individuals in the first half of this financial year. Buying sprees include Mukesh Ambani’s Reliance Industries acquiring a UK-based semiconductor firm for £1.2 billion, and Adani Group’s recent purchase of a Colombian coal mine for $500 million. But it’s not just conglomerates. Wealthy families are diversifying into global real estate, with Knight Frank reporting a 30% jump in Indian buyers for London prime properties.
“The psychology here is rooted in a risk-off sentiment,” says Dr. Anjali Mehta, an economist at the National Institute of Public Finance and Policy. “Domestic GDP growth has slipped to 4.6% in the last quarter, the slowest in seven quarters. Political uncertainty, regulatory red tape, and a sluggish consumption cycle are making billionaires hedge their bets.”
This flight of capital comes despite government efforts to boost ease of doing business. Startup valuations have plummeted by an average of 40% since 2022, and initial public offerings have dried up. For the ultra-wealthy, the calculus is simple: park money where yield is stable. The United Arab Emirates has emerged as a favorite, with Indian investors pouring $10 billion into Dubai real estate in the first nine months of the year, up 50% from last year.
But there’s a darker side to this trend. As billionaire capital exits, domestic job creation suffers. The manufacturing sector, a key focus of the ‘Make in India’ campaign, is expanding at its slowest pace in three years. Meanwhile, income inequality widens. For the average Indian worker, wage growth has stagnated at 2% annually, while billionaires’ net worth has soared by 15% in the same period.
“The government needs to address this equity problem,” argues Rajesh Kumar, a tech entrepreneur who recently relocated his AI startup to Singapore. “If the richest Indians are voting with their feet, it’s a sign that the domestic ecosystem isn’t rewarding innovation. We need better intellectual property laws, faster clearances, and a tax regime that doesn’t punish success.”
Yet not all see this as a betrayal. Critics point out that globalisation cuts both ways. Indian billionaires are also repatriating profits from overseas ventures, and their international networks often lead to tech transfers and joint ventures back home. For instance, the Reliance semiconductor acquisition could boost India’s chip manufacturing ambitions. Still, the optics are troubling when the economy is in a slowdown.
A recent Knight Frank survey found that 68% of Indian billionaires plan to increase their overseas investments next year, up from 45% in 2020. The destinations are telling: Singapore, UAE, UK, US, and Switzerland. These countries offer stable currencies, robust legal systems, and tax efficiencies. For India, the risk is a leaky bucket: the more capital that flows out, the harder it is to finance infrastructure and social programmes.
As the festive season begins, the contrast is stark. Gold sales among the middle class are surging, a classic hedge against inflation. Meanwhile, billionaires are buying football clubs in Italy and vineyards in France. The message is clear: until India fixes its growth fundamentals, the wealth will continue to seek greener pastures abroad.
