India and China have the world's fastest-growing populations of millionaires, with a penchant for luxury travel, gems and designer clothes, a study released in Asia on Wednesday said.
The number of Indian millionaires jumped 22.7 percent last year to 123,000, followed by China where the number of high rollers rose 20.3 percent to 415,000, said the 12th annual World Wealth Report, prepared by US investment bank Merrill Lynch and information technology group Capgemini.
"In the Asia Pacific region, wealth is being created at an unprecedented rate," said Kong Eng Huat, South Asia market managing director at Merrill Lynch Global Wealth Management.
"Notwithstanding the recent dislocation in global markets, the robust economies in Asia are increasingly being driven by the domestic consumption story and continue to spur wealth creation in the region."
The report said China surpassed France as the world's fifth-largest population of High Net Worth Individuals (HNWIs), people with net assets of at least one million US dollars excluding their primary residence.
Also among the fastest-growing were South Korea, where the millionaire population rose by 18.9 percent to 118,000, and Indonesia, which saw a 16.8 percent rise to 23,000, the report said.
Singapore saw a 15.3 percent rise to 77,000 millionaires, it added.
Despite financial turmoil and significant increases in the price of luxury goods, the report said the world's millionaires have an "unquenchable appetite" for luxury items.
Jewelry, gems and watches attracted the largest share of these "passion investment allocations" in Asia and the Middle East, the report said.
Globally, these high-priced toys tend to be art collections, yachts, personal jets and similar items, Merrill Lynch and Capgemini said.
But there are regional differences. Asia's millionaires allocate the most to luxury and "experiential" travel, visits to high-end spas, and designer clothes, they said.
With millionaires holding a significant portion of their wealth in stock markets, market capitalisation performance is an important determinant of millionaire wealth generation, the report said.
Growth in traditional stock exchanges slowed last year but rose in several emerging market exchanges, particularly those in China and India, it said.
India's millionaire growth was boosted by market capitalisation expansion of 118 percent and real GDP growth of 7.9 percent, it said.
"Once recognised as a manufacturing superpower, characteristic of a more nascent market, much of India's recent growth has been driven by the technology, financial services, property, construction and infrastructure sectors," the Wealth Report said.
In China, GDP grew 11.4 percent last year and market capitalisation rose by 291 percent but the country's economy is still built on manufacturing, it said.
"This helps explain why its HNWI population growth is slower than that of India -- and why the gap continues to widen between China's richest citizens, a group with a particularly high concentration of wealth, and the middle-class."
In third place behind India and China, Brazil had the third-fastest growth in millionaires, Merrill Lynch and Capgemini said, adding that half of the 10 nations with the fastest-growing millionaire populations were in Asia.
It said assets held overall by the world's millionaires soared 9.4 percent to 40.7 trillion US dollars last year, with the average exceeding 4.0 million dollars for the first time.