Wealth is an illusion.

Seems that wealth in India has increased by 300% from $1.2 trillion to $3.6 trillion in the 13 years since the year 2000. This wealth is not for the people however. More than 90% survive on less than $10,000 a year while 2.8 million are High Networth Individuals. This does not tally with the the figures put out by our tax fellows. They say that only about 35 million people declare taxable income of which 28.84 million, or 89%, declare income under Rs 500,000 per year. Only 406,000 declare income above Rs 2 million per year which, with very high prices and retail inflation at 9.5%, is considered middle class. The discrepancy is explained by the fact that in India all farm incomes are free of income tax and there are extremely wealthy people who call themselves farmers so as to pay no tax. Also 86% of the wealth in India is held in properties and only 15% in financial assets. In China 45% of wealth is held in financial assets and 54% in non financial assets. Property prices in India have increased by 1000% since the year 2000 making anyone who owns any property into a multi millionaire. Owning a property worth tens of millions of rupees does not translate into higher tax collections. At least 50% of the price of any property is paid in cash or black money to evade the stupidly high rates of taxes and millions of people own ancestral properties, which may have increased in value, but do not add to disposable incomes. There are not many avenues for financial investments in India. Term deposits in banks are a losing proposition. The rate of interest is less than the rate of retail inflation so your money is losing in value and the interest is clubbed with your income so you may end up paying 30% tax on it. Our stock market is highly manipulated. Foreign investors hold a large proportion of shares in our companies which makes our market dependent on what is happening in the US and hence highly unpredictable. Having no other avenue of investment Indians put their faith in gold despite increasing taxes. That is why businesses borrow money from banks to finance new projects. High interest rate to control inflation means that companies are finding it difficult to service their debt and banks are fearful of bad loans. 10 companies have gross debt at Rs 63.10 trillion which is 60% of GDP. Wealth is not some esoteric calculation by clever economists. It should be owned by the people.