Latest / IMI Podcasts / #7: "India Will Be the Biggest Market for IM the Next 10 Years": Ashish Saraff

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#7: "India Will Be the Biggest Market for IM the Next 10 Years": Ashish Saraff · IMI Podcasts

0:03
SPEAKER_02: Ladies and gentlemen, it's 7 p.m.
0:06
SPEAKER_02: in Dubai, 3 p.m.
0:07
SPEAKER_02: in Lisbon, 11am in St.
0:09
SPEAKER_02: Kitts.
0:10
SPEAKER_02: Welcome to a new episode of the Mobility Standard, the podcast where we detect current events, trends, and crucial questions related to investment migration.
0:21
SPEAKER_02: I'm your host, Christian Neshaim, editor of Investment Migration Insider.
0:26
SPEAKER_02: And with me in today's episode I have my co-host Ahmad Abbas, as well as our guest this week, Mr.
0:32
SPEAKER_02: Ashish Saraf of Aretha Capital Partners.
0:36
SPEAKER_02: Himself an Indian by birth, Ashish has for many years been intimately involved in developing the Indian investment migration market, initially focusing on EV5 and more recently on investment funds in European Golden Visa jurisdictions.
0:52
SPEAKER_02: We raised a number of questions that we had about what Ashish says he is confident will become the single largest investment migration market in the world within the next decade.
1:04
SPEAKER_02: Why isn't India a bigger market for investment migration?
1:08
SPEAKER_02: On a per capita basis, RCBI participation in India is far lower than among the other subcontinental economies like Pakistan and Bangladesh.
1:17
SPEAKER_02: Why aren't Indians equally interested?
1:19
SPEAKER_02: What's the right way to enter the Indian investment migration market?
1:23
SPEAKER_02: An enormously diverse regionalized country means that few one-size-fits-all solutions are available for those who wish to penetrate the market.
1:33
SPEAKER_02: What works in Mumbai may not work in Bangalore and vice versa.
1:38
SPEAKER_02: Should you focus on a B2B strategy that involves building relationships with local service providers and institutions?
1:46
SPEAKER_02: Or are you better off going directly to market with a B2C approach?
1:50
SPEAKER_02: What are the push factors motivating Indians to invest in second residencies and citizenships?
1:56
SPEAKER_02: Is it true that the prospect of taxing non-resident Indians, so-called NRIs, is driving demand?
2:04
SPEAKER_02: What about pollution and health concerns?
2:07
SPEAKER_02: How does the restriction on dual citizenship quell demand in India?
2:11
SPEAKER_02: Is it possible we'll soon see dual citizenship legalized?
2:15
SPEAKER_02: The Indian Supreme Court has ruled recently that foreign lawyers cannot give legal advice in India.
2:22
SPEAKER_02: But what constitutes legal advice?
2:30
SPEAKER_02: All of that and a great deal more in today's episode of the Mobility Standard.
2:35
SPEAKER_02: I'd like to remind you that you can follow all of IMI stories on our website, imidaily.com, on our mobile phone apps, and our free newsletters, as well as on your favorite social media network.
2:46
SPEAKER_02: You can also follow this podcast on Spotify, Apple Podcasts, and most other podcast platforms.
2:53
SPEAKER_02: So with the preambles out of the way, let's get this show on the road.
3:04
SPEAKER_02: Ashish, welcome to the mobility standard.
3:08
SPEAKER_02: Very, very pleased to have you here.
3:10
SPEAKER_02: I wonder if uh right off the bat you can introduce yourself to our audience.
3:16
SPEAKER_02: Tell us who you are, what you do, and what you're doing with Aretha Capital Partners.
3:23
SPEAKER_00: Well, thank you for having me on the show, Christian.
3:25
SPEAKER_00: Much appreciated.
3:27
SPEAKER_00: Uh, quick background on Aretha Capital Partners.
3:30
SPEAKER_00: We are a product company.
3:32
SPEAKER_00: We develop and design investment grade products uh which also qualify for mobility clients.
3:41
SPEAKER_00: And our focus is to keep investment as the priority when it comes to investment migration and keep the mobility or the migration bit of the equation as an add-on benefit because cost of capital is something which is very important for m for every investor.
4:01
SPEAKER_00: And my past experience in this industry uh is very, I would say it's not very good in terms of what the investment delivers to the investors, as a result of which, if you see that the market size is much smaller than it could be.
4:19
SPEAKER_00: So we're working towards developing products which not only expands the market size, but also brings in latent investors to this asset category.
4:31
SPEAKER_02: So you so you're saying then that uh historically returns have kind of taken a back seat to the immigration aspect of investment migration, and that if we could uh say bring up the uh investment side of it, that would also boost interest in the immigration matters?
4:53
SPEAKER_00: I am absolutely confident about that, Christian.
4:56
SPEAKER_00: Uh with my experience, which actually started at with EB5, and I I happened to bump into EB5, this was not something uh I was even aware of because my background is private equity, general private equity.
5:11
SPEAKER_00: And in a typical private equity, uh the fund manager shares at max 20% of the hurdle rate.
5:19
SPEAKER_00: So if I deliver$100 on my fund, I get$20 and the investor gets paid back$80.
5:26
SPEAKER_00: When I bumped into EB5, it was the other way around, or probably higher.
5:30
SPEAKER_00: And uh the investor would probably get 5% of the actual return on investment, and the fund manager kept 95% of it.
5:39
SPEAKER_00: Which essentially was from the point of view that, hey, look, we're giving you migration benefits, what more do you want?
5:46
SPEAKER_00: And when you take that approach to market, it is only the very desperate or the absolutely committed migrating mentality people who would go in for that product.
5:58
SPEAKER_00: And there are a bunch of them who could afford that$500,000 but would not go for it because the opportunity cost on that$500,000 is far more valuable than having a USC B5 visa.
6:11
SPEAKER_00: So it is my own experience that we've lost, I would say 50% of the clients we did not acquire, whether it was for US C B5 or any of the European products, was because that it the product was not interesting enough.
6:26
SPEAKER_00: So that's what we're trying to change here.
6:28
SPEAKER_00: We were almost about to launch our EB5 product before the shocking reauthorization uh thing happened, so that's taken a back seat.
6:36
SPEAKER_00: But whenever EB5 is back, I think uh that would be our next product.
6:41
SPEAKER_00: We already have a Portugal Vision Fund and a Greece Vision Fund, which are built on the same lines, and we're trying to promote that to uh not only direct consumers but also to various intermediary channels.
6:54
SPEAKER_00: There are challenges because uh another part of the equation is uh the high cost of distribution.
7:01
SPEAKER_00: So we are trying to address those.
7:04
SPEAKER_00: But I think the bottom line is two objectives.
7:08
SPEAKER_00: One, reduce the costs and fees for consumers and give them or appreciate their capital.
7:13
SPEAKER_00: That is what is the driving force behind Arita Capital Partners.
7:18
SPEAKER_02: I uh wanted to talk today about the Indian market because it's a market that I don't know particularly well at all.
7:28
SPEAKER_02: Uh I know that both Rogelio and you have been heavily involved in the EB5 space in India.
7:35
SPEAKER_02: You've been very successful there.
7:37
SPEAKER_02: Uh maybe you can just tell me, you know, how is it that you guys know each other and and what uh just give me a general overview of your experience working on EB5 in the Indian market.
7:49
SPEAKER_00: Well, Rohelio and I worked together.
7:51
SPEAKER_00: He was he's my ex-boss.
7:53
SPEAKER_00: Uh I worked for him at LCR Capital Partners uh about three and a half, four years ago.
8:00
SPEAKER_00: And as I said, I bumped into EB5.
8:02
SPEAKER_00: It was not intentional, and we did have a lot of success together.
8:07
SPEAKER_00: Uh could be multiple reasons.
8:10
SPEAKER_00: I think US always has been a very attractive uh destination for Indians.
8:16
SPEAKER_00: H1B issues, uh, green card delays and all of that added on to it.
8:22
SPEAKER_00: Half a million dollars was not a very prohibitive number uh and is not a very big number for Indian nationals.
8:29
SPEAKER_00: So all of those led to uh the success of EB5 in the in India.
8:36
SPEAKER_00: But the I think the key here is 90% of EB5 investors were essentially H1B people.
8:47
SPEAKER_00: They were not the investing community as such.
8:50
SPEAKER_00: And that brings me back to what I was saying that if it's a good investment, there would be many more EB5 investors.
8:58
SPEAKER_00: Because currently, at if you're offering a 25 basis points, 50 basis points, or 100 basis points coupon on your investment, uh, that's not really going to attract the investing community of India because the opportunity cost for locking that much amount of money over the next eight, nine, ten years is just not worth it.
9:22
SPEAKER_01: So I'll I'll I'll speak a little uh if I could to to India and in EB5.
9:29
SPEAKER_01: If you correctly noted, uh she you bumped into EB5, it wasn't something that you had studied or knew tremendous amount of about.
9:37
SPEAKER_01: This was in 2017, I believe, late Q4.
9:42
SPEAKER_01: Imagine a country as sophisticated as India and guys as smart as you not really knowing about EB5.
9:48
SPEAKER_01: That's what we found at LCR multiple times for years, uh, over a year and a half, talking to the market, visiting, uh, and folks really amazed that there such a program existed, that EB5 that you can invest in and have a potential getting your money back and getting the green card.
10:05
SPEAKER_01: Uh, and so that was the the brilliance of the strategy at that firm was going to countries that had a very low awareness and introducing what is a phenomenal value proposition in exchange for an investment that certainly can be better structured and deliver higher returns, but even at a at a return of capital perspective and no upside to that investment, I would say it's hard to argue the ROI of a green card.
10:35
SPEAKER_01: We can sit here and talk about 5% or 8%, but a green card is we both I think would agree is invaluable.
10:42
SPEAKER_01: And so manufacturers or fund managers that take care of the capital and protect the investors' interests, yes, they'll capture a lot 95% of the upside of that investment, but as long as they return the capital and do it their level best to do that and don't do what a lot of folks in EB5 and in the industry do in general, which is take the money and run, something that LCR has not done and a lot of other good players have not done, then you know we can argue on uh the upside versus the green card and the benefit, et cetera.
11:16
SPEAKER_01: But what you're doing is not to say that what uh is not worth it.
11:21
SPEAKER_01: I think you are correct in providing an investment-based return and uh uh immigration benefit.
11:27
SPEAKER_01: That's like having your cake and eat it too, and who doesn't like that?
11:30
SPEAKER_01: And so what you're doing actually is very innovative.
11:33
SPEAKER_01: No one I know is is doing something like this.
11:36
SPEAKER_01: And if successful, when successful and proven, uh there will be a market increase.
11:42
SPEAKER_01: There will be more people willing to move forward.
11:45
SPEAKER_01: So both can be correct, right?
11:47
SPEAKER_01: That yes, uh all the economic benefit accrue to the fund manager in EB5, and I still still I think still does, but as long as the money comes back, and that phrase you and I've heard in many meetings in uh in India, uh, as long as the money comes back, then yes, there's an opportunity cost, but the green card and the in the inability to get it any other way for Indians in the United States, uh just because of the immigration policy and the backlog, I think still a very strong uh upside for any investor to come to the US.
12:21
SPEAKER_01: But what you're bringing, I think will will transform the market because it will increase the uh appetite to take a risk on something like this.
12:31
SPEAKER_00: Well, I I completely agree with Rohelio, and that's why I use the word opportunity cost, because if I'm on H1B and I'm waiting for 100 years for a green card, then perhaps just my capital coming back is good enough.
12:46
SPEAKER_00: But that's a very small subset as we've seen the numbers, and and you know, we we've often discussed that why India is not a big as big a number as China is because of the exact same reason that the current products are addressing a very small subset subset of the of the investing community whose core objective is moving abroad.
13:11
SPEAKER_00: So whatever you give them, they'll take it.
13:14
SPEAKER_00: But then there's a 10 times 10x population, which is the investing community, who could also buy your investment products and have immigration just as a top-up.
13:27
SPEAKER_00: So both the sides are right, but the market size is way bigger over the next 5, 10, 15 years if it's an investment product rather than an immigration product.
13:40
SPEAKER_02: Ashish, you you brought up, you know, people are asking why isn't India a bigger investment migration market?
13:46
SPEAKER_02: Why isn't it as big as China?
13:48
SPEAKER_02: It has the same amount of people.
13:50
SPEAKER_02: Obviously, the the quick answer to that is not the whole answer, but part of the answer is that the GDP per capita in China is about five times higher in India.
14:00
SPEAKER_02: I think what is more revealing to consider is that when you compare India with the other subcontinental economies, notably Pakistan and Bangladesh, on which have you know per capita GDPs that are not too different from that of India, even when you adjust for differences in GDP, differences in population between the subcontinental economies, India still comes out as punching below its weight in terms of investment migration market size.
14:39
SPEAKER_02: So Pakistan, Bangladesh, and India face some of the face quite similar limits to their mobility freedoms in that they need visas for most places and and uh they they struggle with a lot of the same things, and you'd think that the demand would be similar, all else being equal.
14:58
SPEAKER_02: I'm wondering if you can tell me, you know, what is it that what is it that makes Bangladeshi applicants apply at you know four or five times the rate of of uh Indians, even when you adjust for differences in GDP and population?
15:14
SPEAKER_00: Well, I I don't think India as a demography is very similar to its other South Asian counterparts because of the there's a basic difference in in the constitution of the country.
15:30
SPEAKER_00: India is a very proud democracy, and as of today, people are not desperate to leave India.
15:37
SPEAKER_00: Most people who I come across in the affluence segment have extremely good opportunities.
15:45
SPEAKER_00: India is a$3 trillion economy marching towards$5 trillion.
15:49
SPEAKER_00: I'm very confident it'll probably touch 10 trillion somewhere between 2030 and 2035.
15:56
SPEAKER_00: And while the GDP per capita argument is very right, the earnings at the top levels are extremely way above GDP per capita.
16:06
SPEAKER_00: In fact, if you're in Mumbai, if you're a CXO, your salaries are at par with someone in London or New York.
16:13
SPEAKER_02: I I agree with that line of reasoning, but doesn't that also mean then that you should have more people in India?
16:18
SPEAKER_02: Because you have more wealthy people, you have uh shouldn't they be equally an equally dynamic market for investment migration or even even greater?
16:28
SPEAKER_00: Absolutely, and that is where the product comes in.
16:31
SPEAKER_00: Because while the bell curve is there, the second point is desperation or need.
16:36
SPEAKER_00: And the absence of both of them reduces the market size.
16:42
SPEAKER_00: As uh Rohelia just put across that you know it all started in China and they were just they wanted to leave.
16:49
SPEAKER_00: I'm an Indian, I speak with Indian people every day.
16:53
SPEAKER_00: In the upper middle class and above, there is no desperation to leave.
16:59
SPEAKER_00: And therefore, those who leave are by virtue of one or the other.
17:04
SPEAKER_00: One, extremely talented people who want to leave and settle down in the United Kingdom or United States, tech guys, guys like me in the financial services.
17:14
SPEAKER_00: Uh we are a different okay.
17:18
SPEAKER_00: And then you have the super rich who want to have multiple residences.
17:22
SPEAKER_00: So you'll be surprised to know that a lot of people who have properties across Europe don't have golden visas.
17:30
SPEAKER_00: If you look at RCBI, the CBI bit in the RCBI does not work for Indian nationals because India does not allow dual nationality.
17:40
SPEAKER_00: So the dual nationality bit essentially removes a very large section of the society for going with uh citizenship by investment programs.
17:50
SPEAKER_00: So those which are offered by these islands or erstwhile Cyprus program.
17:55
SPEAKER_00: I know a lot of people who've invested more than two million euros in real estate.
17:59
SPEAKER_00: We have at Novi, we have concluded real estate sales in the two to five million category.
18:06
SPEAKER_00: But what they've not gone with is a residency or a citizenship alongside it.
18:12
SPEAKER_00: So most certainly there is no shortage of appetite.
18:18
SPEAKER_00: A lot of the investment you speak about in the last decade is corporate investment.
18:23
SPEAKER_00: So money moves out from the companies that the high net worth investor owns.
18:27
SPEAKER_00: He sets up subsidiaries, they buy properties, and as a result, they also get their residence permits, being directors of those companies there.
18:37
SPEAKER_00: So they don't need the golden visa technically, but it's just another property purchase and it's just another residence permit.
18:46
SPEAKER_00: That's one section of the society.
18:48
SPEAKER_00: Then there's a different section of the society who is looking at residency by investment for their next generation.
18:57
SPEAKER_00: These people who are in the age bracket of 42, 60 and have a few million dollars, then then they themselves or their immediate families are unlikely to move out.
19:08
SPEAKER_00: But their next generation is looking for mobility.
19:13
SPEAKER_02: You mentioned, Ashish, that you have seen a lot of uh transactions in the in the million-dollar at the million-dollar level in property across Europe, North America, uh, that there are lots of people out there who own properties in multiple countries, lots of Indians who own properties in multiple countries across the West and don't have a golden visa, don't have an additional citizenship.
19:37
SPEAKER_02: Do you think that there might be a market opportunity there?
19:41
SPEAKER_02: That there is a market for, let's say, retroactive qualification, so to speak?
19:48
SPEAKER_02: So people who have already bought properties or made investments that that mean that they are already qualified, they just haven't filed the paperwork to claim their immigration benefits.
20:02
SPEAKER_00: Well, there could be.
20:50
SPEAKER_00: This will probably uh the golden visa situation will probably change once the Indian constitution allows dual nationality.
20:57
SPEAKER_00: At that point in time, you'll probably have a lot of high net worth having a European passport and an Indian passport.
21:04
SPEAKER_00: But there's a lot of people.
21:06
SPEAKER_02: Sorry, there's nothing stopping Indians from taking part in residency programs, even now.
21:11
SPEAKER_00: And they are.
21:12
SPEAKER_00: It's just that they are not taking the golden visa route, right?
21:15
SPEAKER_00: So for example, uh the example I mentioned, people who have subsidiaries in Europe, they still get their long-term visas based on the subsidiary that they have.
21:27
SPEAKER_00: The fact that they've also bought a two million dollar property is a different transaction.
21:33
SPEAKER_00: So the visa exists, it's just not the golden visa.
21:39
SPEAKER_00: Investment is happening.
21:42
SPEAKER_00: So you could put it this way that Rashishu sold a two million dollar house, but there was no golden visa attached.
21:50
SPEAKER_00: That's that was the client's choice.
21:53
SPEAKER_00: The idea is did he buy a property?
21:55
SPEAKER_00: Yes.
21:56
SPEAKER_00: Does he have a long term residence permit?
21:58
SPEAKER_00: Yes.
21:58
SPEAKER_00: But unfortunately, the two.
22:00
SPEAKER_00: Are not linked.
22:02
SPEAKER_00: And there is a growing trend of this kind of transactions which are happening, especially from the western part of India, and especially from the big families who have multimillion dollar businesses.
22:13
SPEAKER_02: You talk about India as if there are not sufficient push factors to motivate investor migrants to go abroad.
22:23
SPEAKER_02: And you also link investment migration to physical relocation, which, to be fair, isn't always the case.
22:30
SPEAKER_02: I mean, my experience from the Chinese market was that the lion's share of investors had no intention of leaving China at all.
22:39
SPEAKER_02: They, yes, they wanted to set up their kids for attending Eton or uh or Harrow School for Boys or what have you, and they got the visa for that reason and for the mobility maybe that it it provides.
22:55
SPEAKER_02: But they were very much intent on remaining in China to look after their business for much the same reason that you mentioned in India.
23:05
SPEAKER_02: I mean, part of it is um uh the economy is growing much faster or was growing much faster in China than in uh the OECD countries.
23:16
SPEAKER_02: Same as right now in India, the economy is growing much faster than where almost anywhere else where you could place your capital.
23:25
SPEAKER_02: So if everything is hunky-dory in India uh and you're getting great uh returns on your investment, what are the things that are motivating Indians right now to engage in investment migration programs?
23:40
SPEAKER_00: That's a great analogy.
23:42
SPEAKER_00: And uh look, there are no right or wrong answers here.
23:46
SPEAKER_00: I do believe that there is a huge scope of a market expansion in India for the investment migration business.
23:54
SPEAKER_00: How will that happen?
23:56
SPEAKER_00: That will happen with better products coming in, which compete with the financial rewards of the investment.
24:03
SPEAKER_00: And it's not just about emerging markets versus OECD, it's about sophisticated investors versus non-sophisticated investors.
24:11
SPEAKER_00: I remember you mentioning that uh uh investment returns are very bad in the West.
24:16
SPEAKER_00: Well, not really, because if you're talking about only putting keeping your money in the bank, then yes, they are under 1%.
24:24
SPEAKER_00: But there are sophisticated investors or affluent investors in within the United Kingdom who only look at opportunities which deliver 8 to 12% a year, and their investment opportunities do exist in real estate.
24:38
SPEAKER_00: Anyone who has a decent amount of money knows that the the basic cost of capital should be at a certain level.
24:48
SPEAKER_00: Now, that doesn't mean that if I just have a hundred pounds to to save, I need eight percent, that's not possible because then your only option is the bank deposit.
24:57
SPEAKER_00: But we are talking about 300,000, 400,000, 500,000, which is a lot of money, even in the West.
25:03
SPEAKER_00: So, irrespective of where you are, the cost of capital pretty much remains the same.
25:09
SPEAKER_00: In India today, the equity IRRs are close to the 20% mark.
25:14
SPEAKER_00: In the West, equity IRRs are close to the 12 to 13% mark.
25:18
SPEAKER_00: The difference is captured between by the depreciation of the currency.
25:23
SPEAKER_00: If I'm getting 8% on a dollar, I'm getting 14% on a rupee, and therefore it's a good investment.
25:31
SPEAKER_02: Right.
25:32
SPEAKER_02: Because of the depreciation.
25:33
SPEAKER_00: Because of the depreciation.
25:35
SPEAKER_00: And this is a conversation I have pretty much every day in my day job.
25:40
SPEAKER_00: Investors ask me, so what's your fund going to return?
25:42
SPEAKER_00: What's it going to yield?
25:43
SPEAKER_00: What's your hurdle rate?
25:45
SPEAKER_00: That's the kind of sophistication I'm talking about.
25:47
SPEAKER_00: And there is a basic difference between Chinese investors and Indian investors.
25:51
SPEAKER_00: Chinese investors have never asked me these questions.
25:55
SPEAKER_02: Right.
25:56
SPEAKER_02: So one thing to note about China is that uh securities markets and investing in general is doesn't have a long history.
26:08
SPEAKER_02: So I don't think you could even own private property until the late uh 1980s, and certainly no public stock trading or or uh you know uh trading bonds or anything like that of that nature until the early 90s.
26:25
SPEAKER_02: Um India, of course, uh has its own history of of flirting with uh socialism.
26:32
SPEAKER_02: Um I mean essentially from from 47, I guess, uh until the Man Mohan Singh administration in in the what 91 is it?
26:44
SPEAKER_02: 91, yeah.
26:45
SPEAKER_02: Yeah, and then so then you had this big re just like in China you had Kai Fang, the reform and opening up in India.
26:54
SPEAKER_02: Uh you had Man Mohan Singh.
26:57
SPEAKER_02: Uh I don't know if that movement has uh uh an analogous name to that of China, but well that's a financial uh liberalization.
27:06
SPEAKER_00: I would not call it call it a communism or a socialism uh liberalization because Man Mohan Singh was an economics professor and he believed in uh financially deregulating the market.
27:19
SPEAKER_00: And rightly so, because after 40 years of independence, it it needed those three to four decades to get the state back in a shape where everything had to be controlled by the state.
27:30
SPEAKER_00: So but if you look at the securities market, Bombay Stock Exchange is 200 years old.
27:36
SPEAKER_02: Right.
27:37
SPEAKER_02: So So you have maybe you have more just because you have more of a history of trading securities, uh you have a bigger stock of sophisticated investors in India, right?
27:50
SPEAKER_00: I would say that it's a combination of two things, Christian.
27:53
SPEAKER_00: One is the basic sophistication is far higher in India as far as financial investments are concerned, when compared to China, Bangladesh, or Pakistan.
28:03
SPEAKER_00: The reason being that uh in in these three countries, just like in China, similarly in Bangladesh now, all the wealth is being created in the manufacturing sector.
28:14
SPEAKER_00: Whereas if you look at India, wealth is being created in technology, in education, in everything other than manufacturing.
28:23
SPEAKER_00: So there's a distinct difference between those who lead manufacturing businesses, how they see things, versus those who uh look at have services as the background.
28:34
SPEAKER_02: So Yeah, India, in my impression is that the Indian economy kind of skipped industrialization, right?
28:40
SPEAKER_02: So it went.
28:42
SPEAKER_02: Straight from being uh an agrarian society to becoming a high-tech society without going through that uh manufacturing phase that you typically see on the path to uh economic development.
28:55
SPEAKER_00: Absolutely.
28:55
SPEAKER_00: I I think that too, and uh I think it was because the timing of independence and and getting back on your feet, just that around the time of World War was very critical for India.
29:08
SPEAKER_00: And the other difference I believe between Indian investors and other Asian investors is that Indians are a little more conservative.
29:17
SPEAKER_00: The decision-making process is much longer and they are less, I would say, impulsive when it comes to anything above$10,000.
29:29
SPEAKER_02: I have been told by a number of RCBI advisors, particularly in Dubai, yeah, that you know, Indians, sure, they come through in the end, but they take a long time and they need some convincing.
29:43
SPEAKER_02: They they they they do a lot more shopping around, I think, and take much longer to decide.
29:47
SPEAKER_02: This is just anecdotally what I hear.
29:49
SPEAKER_02: I've never had any Indian clients.
29:51
SPEAKER_02: Um, but does that ring true in your case?
29:55
SPEAKER_00: Well, decision-making timelines are certainly longer.
29:59
SPEAKER_00: As I said, they are not impulsive buyers.
30:02
SPEAKER_00: Um they do a lot of research.
30:05
SPEAKER_00: So you can't get away selling anything and everything to them.
30:10
SPEAKER_00: You and you would probably not even realize that they're not believing you in most cases, in my experience.
30:17
SPEAKER_00: But uh it's it's a lot of cultural issues, I guess.
30:22
SPEAKER_02: Uh well, obviously they speak English.
30:24
SPEAKER_02: They speak English, right?
30:26
SPEAKER_02: So they are they're able to uh get information.
30:28
SPEAKER_02: And the Google So they were able to get information from first-hand sources.
30:33
SPEAKER_02: Whereas that was kind of a uh that that was uh so the Chinese inability to speak, I mean, for that generation at least, like let's say the generation that's between 40 and 60 today, their inability to speak English uh was a massive contributor to information asymmetry, I think.
30:53
SPEAKER_00: Uh I was about to use that word, information asymmetry.
30:56
SPEAKER_00: Oh, okay.
30:57
SPEAKER_00: So you're absolutely uh bang on there.
31:01
SPEAKER_00: And and the same is with Bangladesh.
31:03
SPEAKER_00: When I entered Bangladesh market two years ago, it the kind of information asymmetry that exists there is you would find that the same in Shanghai or and that's because over the last 20 years, Bangladesh has taken the same path as China has.
31:19
SPEAKER_00: They are the manufacturing back office of the world.
31:23
SPEAKER_00: Whereas India has always been the services back office of the world.
31:27
SPEAKER_03: Yeah.
31:28
SPEAKER_00: So there's a distinct there's a distinct difference between the integrity and the constitution of the two economies.
31:36
SPEAKER_02: Okay, nonetheless, um even though there are aren't as many push factors as there may be in other countries, there must be some push factors um to make this market grow at all.
31:48
SPEAKER_02: Things like pollution.
31:50
SPEAKER_02: What about things like healthcare provision?
31:54
SPEAKER_02: I don't that may be a media hype.
31:56
SPEAKER_02: I don't know if if the the the actual reality on the ground is as serious as they portray it.
32:02
SPEAKER_02: I I feel like they have a tendency to exaggerate.
32:05
SPEAKER_02: And another thing is two more things.
32:08
SPEAKER_02: Uh the the specter of taxation of non-resident Indians and also significant capital controls, uh, controls on the outflow of capital.
32:21
SPEAKER_02: Might those be push factors?
32:24
SPEAKER_00: Could be.
32:25
SPEAKER_00: Look, a lot of this is, as you rightly said, marketing hype and media hype.
32:29
SPEAKER_00: Uh it's it's just like creating problems which don't exist.
32:33
SPEAKER_00: And I do have a laugh, especially when I spend 10 minutes a day every day on LinkedIn, and when I see that, you know, articles which say there is an exodus of millionaires from India.
32:44
SPEAKER_00: I don't know any millionaire who left India, and I know a lot of them.
32:48
SPEAKER_00: Uh then you come to taxation, so how the taxation is going to a lot of that is absolute crap.
32:55
SPEAKER_00: Uh, and nothing would change in the sense that even if I went for a residency or a golden visa passport, nothing would change overnight in any of those aspects that you mentioned.
33:07
SPEAKER_00: The residency is a long-term planning.
33:10
SPEAKER_00: I would say every affluent Indian is looking at it.
33:14
SPEAKER_00: And they're going to make a decision whether it's going to be three months or three years, I don't know.
33:18
SPEAKER_00: But India will be the biggest market in the next 10 years for investment migration.
33:23
SPEAKER_00: Only the best companies will survive.
33:26
SPEAKER_00: Those who can who are patient and who have good products will survive the market because I'm not very sure if you can sell anything and everything in India.
33:37
SPEAKER_02: Sure, you you you made a very bold statement.
33:40
SPEAKER_02: You're you're going on record here, Ash, saying that India will be the next big investment migration market.
33:47
SPEAKER_02: So next next next 10 years.
33:49
SPEAKER_02: What makes you so confident about that?
33:53
SPEAKER_00: Well, if if our economic projections are correct and if we are marching towards the five, six, seven trillion dollar mark, there is a lot of wealth which is going to be created.
34:02
SPEAKER_00: And that wealth has to be parked somewhere.
34:05
SPEAKER_00: And if you have a good product, if you have good products uh across the spectrum, every decent investor knows that all my money should not be in the same country.
34:16
SPEAKER_00: The fact is that investors are investing abroad, as you rightly said.
34:21
SPEAKER_00: There are various asset management companies, family offices who work on portfolios, and there are these hundred million, two hundred million dollar portfolios, out of which only 30% is in India.
34:32
SPEAKER_00: 70% is invested globally.
34:36
SPEAKER_00: So it's not that the money is not being invested, it's not that the money will not be invested going forward.
34:41
SPEAKER_00: How do we tie it up to the RCBI market?
34:45
SPEAKER_00: It's just about making better products and of course increasing awareness, which would only happen over time.
34:53
SPEAKER_00: I'm very confident India would be the biggest market because of this enormous amount of wealth being created.
35:00
SPEAKER_00: But all the other aspects that you talk about usually they are they don't exist.
35:06
SPEAKER_00: Let's take tax, for example.
35:08
SPEAKER_00: Like any other developed country, India taxes are either based on physical residence or on source.
35:15
SPEAKER_00: So if you're ba if you live in India for more than 182 days, you pay taxes in India for your global income.
35:26
SPEAKER_00: If you've already paid some of that tax of your foreign source income in the foreign country, you get a tax credit for that.
35:33
SPEAKER_00: So there's no way you're actually being penalized.
35:37
SPEAKER_00: So if I'm running a business in India, how does a golden visa help me?
35:42
SPEAKER_00: Now you're talking about non-resident Indians who are based in Dubai mostly.
35:47
SPEAKER_00: Those who are settled in Dubai, they have a lot of connection back home.
35:54
SPEAKER_00: They just can't stop being an Indian overnight to save a little bit of tax money.
36:00
SPEAKER_00: So does this problem exist?
36:03
SPEAKER_00: Yes, but is it big enough for people to give away their Indian passports and become citizens of another country just for the sake of it?
36:12
SPEAKER_00: Absolutely not.
36:13
SPEAKER_00: I don't know of any high net worth person who would give away an Indian passport one fine morning and say, Look, I'm doing this to save taxes.
36:22
SPEAKER_00: No.
36:23
SPEAKER_00: Okay, a very few of them who have totally left the country have no routes back at home.
36:28
SPEAKER_00: But they were in the Middle East, and Middle East, you're always a guest.
36:31
SPEAKER_00: You never get citizenship, irrespective of whether they come with 10-year golden visas or 20-year golden visas.
36:37
SPEAKER_00: Yeah, you're never going to be a citizen there.
36:40
SPEAKER_02: High net worth Indians living abroad are overwhelmingly concentrated in Dubai at the moment, right?
36:49
SPEAKER_02: And so, yes, in Dubai, sure, you're not going to get citizenship.
36:53
SPEAKER_02: Uh, that may be a part of why you're not encountering any Indians saying, I'm giving away giving away my citizenship to save on tax.
37:02
SPEAKER_02: Americans do relinquish their citizenship to save tax.
37:07
SPEAKER_02: That's a different mentality.
37:09
SPEAKER_02: What do you think is the difference in mentality that causes Americans to say tax savings are worthy of relinquishing my citizenship?
37:22
SPEAKER_02: It's it's big enough, it's a bit it's important enough in my life that I'm willing to give up my US citizenship, whereas Indians say no.
37:31
SPEAKER_00: You could say Indians are probably behind in terms of time or uh maturity, or maybe the next generation will do it.
37:42
SPEAKER_00: Maybe 20 years from now, the Indians who are multimillionaires would be happy to give away their Indian citizenship.
37:48
SPEAKER_00: But again, the question is what am I giving it for?
37:52
SPEAKER_00: Now I'm sure that I would be happy to give it for a European citizenship or for a British citizenship.
38:00
SPEAKER_00: I'm not so sure if I would be willing to give it up for a Caribbean or I mean, no offense there.
38:07
SPEAKER_00: The point is that look, a passport is not only about tax and travelling, it's a lot more.
38:14
SPEAKER_00: I mean, last year in COVID, if you were stuck outside your country, who were the first ones to airlift their people?
38:24
SPEAKER_00: First was UK, they started their flights and on the 15th of April.
38:28
SPEAKER_00: My family was stuck in India.
38:31
SPEAKER_00: Then Americans, Canadians, European countries, then India.
38:35
SPEAKER_00: India airlifted a lot of Indians from Canada, US, UK, all over the world.
38:40
SPEAKER_00: If you've given up your Indian passport, do save taxes.
38:44
SPEAKER_00: And in three months, you will what are the other passports you could have gotten?
38:48
SPEAKER_02: Yeah, I don't I don't I don't remember St.
38:51
SPEAKER_02: Kitts sending a fleet of Boeing 747s anywhere.
38:55
SPEAKER_02: It's true.
38:56
SPEAKER_02: I've been told, and I and I've I've been told that there is a stigma in India, and I've been told that this is also incorrect, that I've been incorrectly informed, but my understanding was that there there has been historically a stigma related to emigration from India in that two forms of stigma.
39:20
SPEAKER_02: Number one is for the lower end of the income distribution, where it's like, okay, this person doesn't have sufficient economic opportunity in India, so he needs to emigrate to uh make something of himself uh in another country.
39:36
SPEAKER_02: That's one.
39:36
SPEAKER_02: And then at the top end of the income distribution, the stigma takes the form of suspicion.
39:42
SPEAKER_02: You know, why is this person doing that?
39:44
SPEAKER_02: And obviously, the I can imagine that the the recent uh spat of stories around um Mehut Choxi, uh obviously that uh I mean it's been all over all over the Indian media.
39:59
SPEAKER_02: Uh it's it's it's caused a great furroar in India.
40:05
SPEAKER_02: Uh how uh was that story received and interpreted in India?
40:11
SPEAKER_00: I'm not sure I could agree to either of what you said, uh Christian.
40:16
SPEAKER_00: Perfectly fine.
40:17
SPEAKER_00: The reason there are multiple reasons for it.
40:20
SPEAKER_00: One is that again, memory is very short-lived for these kinds of incidents to happen.
40:25
SPEAKER_00: They happen then people forget about it.
40:27
SPEAKER_00: As you rightly said, there are segments, and the bottom of the pyramid is the migrant laborers.
40:35
SPEAKER_00: Now, back in the 80s, 90s, uh, people would go to the Middle East to work because they would offer higher wages in comparison to uh what they would get paid in India.
40:46
SPEAKER_00: Today that doesn't happen.
40:49
SPEAKER_00: I I've met people when I'm in a cab in Mumbai, and I always try talking to people.
40:55
SPEAKER_00: They say, Yeah, I used to work in Saudi Arabia, but now I make more money in Mumbai than in Saudi Arabia, so I don't go there anymore.
41:03
SPEAKER_00: So is are people going away because there's no economic opportunity in India?
41:09
SPEAKER_00: Well, that's not an absolute truth.
41:12
SPEAKER_00: There are some ambitious people who think that I can be better off if I'm abroad, or there's a specific opportunity if I'm abroad.
41:19
SPEAKER_00: Then there's a certain section of people who have a perceived benefit of being abroad.
41:25
SPEAKER_00: And that is because of maybe someone uh from their near and dear ones or the larger family moved back 10 years ago and has made it big in the West or has made it big in Dubai.
41:38
SPEAKER_00: Then there is a segment of the professionals who take sort of intra-company transfers.
41:46
SPEAKER_00: That is the segment which I believe will become the biggest consumer segment for golden visas.
41:52
SPEAKER_00: The CEOs, CXOs, people making between 200 and 200,000 to a million dollars a year, they're going to be become the biggest consumers of especially programs like European ones, which don't need you to stay for long periods of time and yet give you a path to citizenship.
42:11
SPEAKER_00: Because what they are not going to go for is the quick citizenship programs.
42:16
SPEAKER_00: They're not going to leave their Indian passports for that.
42:19
SPEAKER_00: What they can't do is they can't stay for 180 days abroad because they've got good jobs and good businesses back home.
42:26
SPEAKER_00: So what they need is somewhere in between.
42:28
SPEAKER_00: Programs which don't need you to spend, let's say, more than a month abroad, which is perfectly fine because I could have a summer vacation for 15 days and a winter vacation for 15 days.
42:41
SPEAKER_00: Everyone has 30 paid holidays a year.
42:44
SPEAKER_00: And then there's an eventual citizenship in either United Kingdom, US, UK, or any of the G7 countries essentially.
42:52
SPEAKER_00: That is when I would be willing to give up, give up my Indian passport.
42:56
SPEAKER_00: So that's sort of the sweet spot for the Indian affluent slash high net worth.
43:02
SPEAKER_00: And then you have the ultra high net worth who don't care what passport they're owning because when it comes to taxes, when it comes to finances, it's all being managed by the best in the business globally.
43:14
SPEAKER_00: So probably a KPNG is doing my taxes, so they know how to set up trusts, estates, and how to save as much taxes as possible.
43:22
SPEAKER_00: I've got long-term visas of pretty much every country on my passport.
43:26
SPEAKER_00: Because the moment I leave my Indian passport, there are certain benefits I lose back in India.
43:31
SPEAKER_00: A lot of high net worth have agricultural income.
43:33
SPEAKER_00: As a non as an overseas citizen of India, you can't hold agricultural land in India.
43:39
SPEAKER_00: So am I willing to forgo my ancestral agricultural land, which is probably worth$30 million today?
43:47
SPEAKER_00: Again, the question of opportunity cost.
43:49
SPEAKER_00: So EB5 was a different ball game.
43:51
SPEAKER_00: It was specifically H1B takes 100 years to green card.
43:56
SPEAKER_00: Do you have 500,000?
43:58
SPEAKER_00: That is the smallest market.
44:00
SPEAKER_00: It's possible.
44:02
SPEAKER_00: And they got what 5,000 investors over three years?
44:06
SPEAKER_04: If India do allow dual citizenship, do you think the Caribbean programs will actually become popular within the city?
44:14
SPEAKER_04: I think so.
44:14
SPEAKER_04: I think so.
44:15
SPEAKER_04: So that's the only, let's say, obstacle in the face of Caribbean CIPs in India.
44:21
SPEAKER_00: Absolutely.
44:22
SPEAKER_00: Absolutely.
44:23
SPEAKER_00: It's a simple uh trade-off.
44:25
SPEAKER_00: What am I giving up and for what?
44:27
SPEAKER_02: Any chance that will happen?
44:30
SPEAKER_00: Well, it's it's been pending for a long time, man.
44:32
SPEAKER_00: I think uh of course COVID has slowed down a lot of uh issues in the parliament, but I guess somewhere in the next three to five years that's an absolute possibility.
44:42
SPEAKER_00: Okay, so it's not resident Indians have called for it.
44:46
SPEAKER_00: Uh people like me, we are part of Indian groups.
44:50
SPEAKER_00: Everyone has been pitching for it for the last 10 years.
44:52
SPEAKER_00: It's all it has been tabled in the past.
44:54
SPEAKER_00: In 2017 and 18, it was tabled in the parliament as well.
44:58
SPEAKER_00: It's one of the pending bills.
45:00
SPEAKER_00: Because the overseas Citizen of India card removes some key rights which the non-resident Indian community has been lobbying for a very, very long time.
45:12
SPEAKER_00: I'm very confident by 2025, India will allow dual nationality.
45:17
SPEAKER_02: Wow, okay.
45:18
SPEAKER_02: That that would be a watershed moment.
45:21
SPEAKER_02: Absolutely.
45:22
SPEAKER_02: That would really transform the market.
45:24
SPEAKER_02: One one last thing that I wanted to ask you.
45:27
SPEAKER_02: Um I saw uh we reported on this, that um earlier this year the Supreme Court of India ruled that only Indian registered lawyers can provide immigration advice in India.
45:42
SPEAKER_02: So how does this affect the prospects of non-legal RCBI specialists, foreign and domestic?
45:51
SPEAKER_02: I mean, just the ones that are not whether you're whether you're a foreigner or an Indian, but you're not a lawyer, how are you able to practice RCBI advisory in India?
46:01
SPEAKER_02: Are there ways around it?
46:02
SPEAKER_02: Is it is it set in stone?
46:04
SPEAKER_02: How does that work?
46:07
SPEAKER_00: Well, I have read uh the law.
46:11
SPEAKER_00: Uh I have read the ruling a little bit.
46:14
SPEAKER_00: I just came through it.
46:15
SPEAKER_00: And the first thing I did was I pressed control F and typed immigration just to see how many times it appears on the 52-page document.
46:24
SPEAKER_00: And it appeared once.
46:26
SPEAKER_00: And the sentence where it appeared, it says people who fly in and fly out violate Advocate Act and immigration laws, which means that they are coming on a tourist visa but for a business purpose.
46:39
SPEAKER_00: So the ruling does not say anything about not being able to practice immigration law.
46:45
SPEAKER_00: The background of the ruling is there have been cases for over two decades.
46:51
SPEAKER_00: A lot of foreign lawyers fly in, fly out, not because they just want to do it.
46:56
SPEAKER_00: Large corporates hire them to come and advise on MA transactions and arbitrations.
47:03
SPEAKER_00: And they so they're literally retained to come in for a week, ten days, and give them advice for two reasons.
47:11
SPEAKER_00: In some cases, that advice is not available locally or was not available locally back then, which is different today.
47:18
SPEAKER_00: So we see less number of lawyers fly in, fly out in the last five years, or B, they're discussing something for which they need absolute confidentiality and they don't want to talk to an Indian law firm.
47:31
SPEAKER_00: Right?
47:31
SPEAKER_00: Those were the two key reasons why the super rich would hire fly-in-fly out lawyers.
47:39
SPEAKER_00: It was only in 2017-18 that the EB5 lawyers started coming and setting shop in Mumbai and Delhi in hotels and staying there for months at a stretch.
47:50
SPEAKER_00: Now, if you look at the ruling, it essentially only relates to all the arbitration, MA, and those kind of activities.
48:01
SPEAKER_00: But it does say that as a general matter of practice, foreign lawyers cannot practice in India even on a fly-in-fly-out basis.
48:11
SPEAKER_00: So it now we come to the definition of legal practice.
48:18
SPEAKER_00: That is debatable.
48:20
SPEAKER_00: A.
48:20
SPEAKER_00: B, it depends on who is giving that advice.
48:23
SPEAKER_00: Because as a manufacturer, I don't give any legal advice.
48:28
SPEAKER_00: What I say, or what anyone uh of my people say, that's available on Google and on page one.
48:35
SPEAKER_00: That if you make an investment of X amount of money, you get a golden visa.
48:40
SPEAKER_00: So I'm not sure if someone saying that look, an investment of$900,000 in in a US project gives you an EB5 can be construed as legal advice in the first place.
48:51
SPEAKER_02: Oh, so you you mean that you would have to actively be advising a particular course of action, that's when it becomes legal advice.
48:59
SPEAKER_00: Yeah, I mean I I've shared those with my lawyers as well.
49:02
SPEAKER_00: And I think if you look at the common law, if you look at English law, the word advice basically means that you've been retained and paid for it.
49:11
SPEAKER_00: Anything outside that, if you've not been paid for, it cannot be construed as advice.
49:16
SPEAKER_00: Uh you could be walking down the road and say, hey, there's a pothole there.
49:20
SPEAKER_00: That's not advice.
49:21
SPEAKER_00: Because I haven't retained you for that and I have not paid you for that.
49:25
SPEAKER_04: Yeah.
49:26
SPEAKER_04: So it's just a fact.
49:27
SPEAKER_04: Yeah.
49:27
SPEAKER_04: Like saying somebody, if you get divorced, you may have to pay alimony.
49:30
SPEAKER_04: That doesn't make me a lawyer.
49:32
SPEAKER_04: It's just, you know, how things go.
49:34
SPEAKER_00: Correct.
49:34
SPEAKER_00: So when you look at uh the RCBI space, saying that doing this leads to this is not advice, in my opinion.
49:43
SPEAKER_00: I could be wrong.
49:44
SPEAKER_00: I'm not a lawyer.
49:45
SPEAKER_00: But the challenge is it it's important to know who you are in the value chain.
49:51
SPEAKER_00: Like Aretha Capital Partners is the manufacturer of the product.
49:56
SPEAKER_00: It has relationships with lawyers in Europe who all of who have Indian offices, either themselves or associate offices.
50:06
SPEAKER_00: So when a prospect is ready to move, that is when the lawyer comes into picture.
50:13
SPEAKER_00: So who is left?
50:15
SPEAKER_00: Lawyers are perfectly fine.
50:17
SPEAKER_00: All the work is done in Europe or in the US for that matter.
50:20
SPEAKER_00: What would an Indian lawyer be able to do?
50:22
SPEAKER_00: The ruling leaves a very important consideration that okay, only Indian lawyers are allowed to practice law in India.
50:30
SPEAKER_00: But what if the Indian lawyer is not qualified in the foreign law?
50:34
SPEAKER_00: What does he do?
50:36
SPEAKER_00: Because you can't give out a blanket approval to something that you're not qualified in.
50:41
SPEAKER_00: And therefore, the question of association comes in.
50:44
SPEAKER_00: And in my experience, the top thousand firms in the world all have offices in India, or at least have an affiliate office in India who can become the regulatory point of delivering the advice.
50:57
SPEAKER_00: But the real work does not happen in India any which ways.
51:01
SPEAKER_00: All the work happens abroad.
51:04
SPEAKER_00: So I guess it only poses a challenge for uh the fly-in-fly out people who used to do conferences, um, especially during the EB5 days.
51:14
SPEAKER_00: And it possibly poses a challenge for intermediaries.
51:17
SPEAKER_00: But again, it's it's a big country, they have to, so someone has to pursue it, uh, and then there'll be a lot of back and forth.
51:25
SPEAKER_00: Because intermediaries may be unknowingly engaged in providing advice.
51:32
SPEAKER_00: And to be honest, a lot of them are not even qualified to provide that advice.
51:37
SPEAKER_00: So I would say that's marketing, that's not really advice.
51:41
SPEAKER_02: Yeah.
51:43
SPEAKER_02: One question that I always have about India is you know, if you are um an international RCBI specialist and you want to penetrate the Indian market, uh you know, we we tend to think of India as a country, and it is a country, but it's a country in the same way that you know it's as diverse as Europe in terms of, or perhaps even more diverse in terms of culture, language, religion.
52:13
SPEAKER_02: You can't have you can't take one approach, there's no one size fits all approach to India.
52:19
SPEAKER_02: So if you are saying not a Dubai-based firm, because Dubai-based firms deal a lot with Indians, but in Dubai, but say you are a UK-based firm, a North America-based firm, and you want to get into that Indian market, where do you begin?
52:35
SPEAKER_02: Do you just start by going to Mumbai and Delhi and Chennai and Bangalore, or uh is there a right way to enter the Indian market?
52:46
SPEAKER_00: Well, not really.
52:47
SPEAKER_00: I think uh geographically, if you're a new operator, you're potentially best off starting in Mumbai and then taking it from there because Mumbai uh is the financial capital of the country.
53:00
SPEAKER_00: But having said that, there are already enough sellers in the market.
53:04
SPEAKER_00: I mean, there are more sellers than buyers.
53:06
SPEAKER_00: For every one client, I think there are 10 sales executives in the country who are chasing to close him.
53:13
SPEAKER_00: And over time, this will, of course, become more efficient as those who don't contribute much to the value chain will start closing shop.
53:22
SPEAKER_03: Yeah.
53:23
SPEAKER_00: But it's important to define what's an RCBI specialist here.
53:27
SPEAKER_00: Who are you in the value chain?
53:29
SPEAKER_00: Are you the product manufacturer?
53:31
SPEAKER_00: Are you an intermediary?
53:33
SPEAKER_00: Are you a lawyer who's going to do the paperwork at the end of the day?
53:37
SPEAKER_00: Or are you just trying to aggregate everyone on the market and create a package product?
53:44
SPEAKER_02: No, say you are not an intermediary in the sense that you're doing you're looking for B2B connections in India, but say you are an RCBI specialist who you're not you're not the lawyer.
53:56
SPEAKER_02: You don't do the um document submission in Portugal or in in the UK or in the Caribbean, but but you are a run-of-the-mill RCBI firm, uh international, and you want to go B2C in India, or or say you want to go B2B in India, where who do you partner with?
54:17
SPEAKER_02: Where do you start?
54:18
SPEAKER_02: Do you go to one of these mega firms that specializes in you know student visas and uh skilled visas, that kind of thing?
54:27
SPEAKER_02: Or do you go to institutional partners like like law firms and family offices?
54:33
SPEAKER_02: Where is the best point of entry, you think?
54:37
SPEAKER_00: Well, I in my humble opinion, if you're not a manufacturer, then you're probably not going to be fine with a B2B kind of a business model.
54:45
SPEAKER_00: You're better off going to be with a B2C business model.
54:49
SPEAKER_00: Because India is a price-sensitive market, and uh as the market matures, there will be a price pressure.
54:57
SPEAKER_00: So if you if you are someone who is already aggregating someone else's product, let's say if if you're selling my funds or if you're selling a developer's property, and then so you get paid a certain amount out of which you want to share a certain amount to a B2B partner.
55:15
SPEAKER_00: That is putting in, as Ahmad said, a lot of people in the value chain, increasing the cost to the consumer or creating a price point pressure.
55:25
SPEAKER_00: So if you want to be in India, I think you should be a B2C player, and uh you should start by setting up yourself in one of the four metropolitan cities and creating your brand awareness and educating the clientele, why you're probably better off than someone else.
55:42
SPEAKER_00: Because if you went to the B2B market, already a lot of principles are in the B2B market.
55:49
SPEAKER_00: So then you're talking about competing on price, what value addition that you do, and all of these put together will not get you anywhere, in my humble opinion.
55:58
SPEAKER_02: This is the opposite of the strategy that has traditionally worked for companies going into China.
56:04
SPEAKER_02: In China, effectively, you were prohibited from going B2C.
56:08
SPEAKER_02: You just couldn't.
56:10
SPEAKER_02: Exactly.
56:10
SPEAKER_00: Because no one could understand you.
56:12
SPEAKER_02: Yeah, that's number one.
56:14
SPEAKER_02: Nobody could understand you.
56:15
SPEAKER_02: But number two is you had long-established, very, very large immigration firms with million-dollar marketing budgets, who basically their job was to was to vacuum up as many direct clients as possible and deliver them in bulk to intermediaries, typically in the Middle East or in Europe, who would in turn pass them on to submitting agents locally in the Caribbean or in Portugal and Spain, etc.
56:48
SPEAKER_00: Correct.
56:49
SPEAKER_02: So India, you're saying then, is you know, you you you absolutely must use the the opposite model where you should go direct to market because it is so price sensitive and because there is not that information asymmetry, there won't be any room uh for that kind of margins that that you need to successfully run uh along the B2B uh strategy, right?
57:14
SPEAKER_00: I think so.
57:15
SPEAKER_00: I think uh all the firms who have gone B2C in India have been successful in some way or another.
57:22
SPEAKER_00: Of course, they have a little bit of B2B distribution as well, but at the end of the day, if you're not at the top of the value chain, if you're not the product manufacturer, if you're not the developer or um the fund manager who owns the product, then you're unlikely to be able to compete in the B2B market.
57:42
SPEAKER_02: That's it for today, folks.
57:44
SPEAKER_02: But we'll be back soon with another episode of the Mobility Standard.
57:48
SPEAKER_02: In the meantime, I encourage you, the listener, to send us the questions you have about investment migration.
57:54
SPEAKER_02: If we're able to answer them, we'll do so during our next episode.
57:58
SPEAKER_02: I want to thank my co-host, the inimitable Amarapas, and remind you to follow our work on imidaily.com, the world's number one publication for investment migration, home to the internet's greatest collection of investment migration data, real estate expert opinion, and the intelligence you need to be a successful investment migration professional.
58:19
SPEAKER_02: Thank you for listening.