Wealthy Indians increasingly invest in Australia

This year, Australia will overtake Spain as the world’s 12th largest economy, despite being 52nd in terms of population. This explains the massive increase in Australia’s foreign direct investment which leapt to US$ 68 billion in 2012, nearly double the previous year, according to government statistics. To help boost investment from Asian countries, including India, the Australian government will next month launch a “significant investor’s visa programme. The new Australian visas will target individuals who invest at least A$5 million in certain assets, such as infrastructure government bonds, in return for concessions on the usual migration requirements including qualifications and English skills.

While Indian nationals have traditionally favoured Britain and North America as offshore investment destinations, private wealth bankers have noticed a growing demand for Australian real estate, particularly hotels and serviced apartments. With a forecast of about 10 per cent per year, total returns in Australia are the highest in Asia, topping Japan’s 9 per cent and South Korea.

India’s wealthy, from old money to nouveaux riches IT entrepreneurs, are quietly snapping up hotels and mines Down Under just as Australia embarks on an immigration campaign to attract long-term investment. The Jindal family, ranked among the world’s top 80 richest by Forbes, in May bought two minor stakes, worth a total of U$ 27 million, in Australian iron ore and coal mines through Jindal Steel & Power.

That followed a US$2 billion purchase by Indian self-made billionaire and college-dropout Gautam Adani of a coal mine in the state of Queensland last year. Silverneedle Hospitality, a company backed by Nadathur S. Raghavan, an Indian philanthropist and co-founder of software company Infosys Technologies, just bought a hotel in Brisbane for A$57 million. Last year, it bought a chain of about 60 hotels in Australia and New Zealand for an undisclosed sum.

adapted from Reuters

Boheme – Bondi Beach, luxury residential complex, Sydney