The rise of Indian oligarchs

The number of billionaires in India has quadrupled since 2009 to 100 in the current year. At the same time the world billionaire population only a little more than doubled to 1,645. But that doesn’t say it all.

We also looked at the number of billionaires in a country per trillion dollars of that country’s gross domestic product (GDP). This number grew for India from 20.4 in 2009 to 53.3 billionaires in the current year. By that yardstick, India is behind only Hong Kong. Even Russia, which is synonymous with oligarchy, has a lower number of billionaires per trillion dollars GDP than India, although that is a comedown from previous years.

Given that India’s per capita GDP is lower than many of the countries that make these lists, it is a massive outlier when it comes to the concentration of wealth in the hands of the extraordinarily rich.

Five years before he became Reserve Bank governor, Raghuram Rajan in a 2008 speech at the Indian Merchant Chambers of Commerce red-flagged the issue.

“Three factors—land, natural resources, and government contracts or licences—are the predominant sources of the wealth of our billionaires. And all of these factors come from the government" he said.

“I also do not want to say that every government licence or contract should prima facie be suspect… But I do want to argue that the numbers are alarming—too many people have gotten too rich based on their proximity to the government. If Russia is an oligarchy, how long can we resist calling India one?."

The countries selected for the comparison, and those used in the graph, are those with the highest number of billionaires. The numbers are from the Forbes rich list.

Interestingly, it looks like India’s billionaires are getting poorer. In absolute terms, the average wealth of India’s billionaires has fallen from $4.2 billion to $3.4 billion from 2009 to 2014. However, as a proportion of the total wealth of the world’s billionaires, their wealth has been increasing.