India may see family wealth worth $1.5 trillion change hands in 10 years

India is poised for a significant intergenerational wealth transfer over the next decade, with an estimated $1.3 trillion to $1.5 trillion changing hands, according to a Julius Baer-EY report. This shift is occurring as family wealth becomes more institutionalized, with family offices transitioning from founder-centric decision-making to formal governance structures.

These include the establishment of investment committees, family councils, and advisory boards, as well as the hiring of chief investment officers, financial officers, and risk managers. As a result, family offices are diversifying their portfolios to include alternative investments such as alternative investment funds (AIFs), startups, private equity, venture capital, private credit, and real estate, often through complex and offshore structures.

This expansion is expected to grow the alternatives market, currently valued at around $400 billion, which could surpass $2 trillion by 2034, bolstered by rising participation from high-net-worth individuals (HNI), favorable policies, and a demand for assets with higher yields and lower correlations. Currently, India is home to over 200 billionaires, the third highest globally, and more than 19,000 ultra-high-net-worth individuals with assets exceeding $30 million, a figure that could reach 25,000 by 2031.

This growth has been driven by initial public offerings (IPOs), private equity exits, and founder liquidity events. Surabhi Marwah, a Tax and Leader in Family Office Advisor Services at EY India, noted that whenever there is an exit or a family office setup precursor to an IPO, these families seek assistance in structuring their wealth.