in the 16th century, India was the second largest economy in the world, accounting for about 25 per cent of the world’s income. Perhaps India had produced the wealthiest people in the 16th century, itself being among the richest countries in the world. Unfortunately we do not have data to validate it. India’s glorious period of the 16th century is back — it has entered a period of fastest economic growth and has developed a vibrant and robust stock market in the last decade. Both are vital for creating wealth for individuals.

In the developed world, Bill Gates, Warren Buffett and Wal-Mart tycoon Sam Walton could do it. John Rockefeller, Andrew Carnegie, and Jay Gould were pioneers at it. All these people were celebrated business leaders, had pioneering visions and were brilliant and passionate about their businesses. However, for almost all of them, the predominant source of their wealth creation were stock markets!

India, with a robust economic growth outlook and a vibrant stock market, is well positioned to create the world’s richest persons over the next five years. Look at some promising facts — in 1999, the US accounted for nine out of 10 of the world’s top 10 richest persons. In 2009, the share of the US came down to just three — thanks to faster growth in other economies and suitable rewards for the successful corporate from the respective stock markets. Indians, who stood far away from this list then, occupied two slots in top 10 in 2009. India entered a phase of fastest economic growth in the present decade and several business houses followed suit — the result is that the market cap of the Sensex grew by about eight times in the past 10 years and India’s largest firm’s market cap grew by 15 times. In contrast, the US failed to catch up with the emerging economies — Microsoft and Berkshire Hathaway, which produced two of the richest persons in the world, exhibited an almost stagnant market cap between 1999 and 2009 at around $270 billion and $110 billion, respectively!

The wealth of the top 10 richest persons in India varies from $6 billion to $19 billion, while globally, the range is from $18 billion to $40 billion. These gaps are not too substantial going by our recent performance. Indians not only can jump up in the ladder to the topmost position in the list of wealthiest people in the world, but can also have the potential to occupy seven out of the top 10 positions. The ingredients needed to achieve this are the growth prospects for the economy (which would provide better valuation for equity markets), solid business models (which can bank on fast economic growth) and visionaries (who can maximise the opportunities arising from the blend of economic growth and perception driven equity markets).

India has all the basic ingredients required — it is set to replay its 9 per cent growth story as it is well positioned in terms of both strong demand drivers and also capital. Look at solid capital availability — over 36 per cent domestic investment rate, foreign investment rate of over 2 per cent of GDP and a banking credit base of over Rs 29 trillion against just Rs 7 trillion about 8 years ago. Also recall the strong demand drivers — the emergence of a dominant service sector (which maintained over 8 per cent growth despite the meltdown), strong rural demand (thanks to favourable terms of trade for the agricultural sector), impact of wealth created by soaring prices of gold (Indian households’ gold holdings are worth over Rs 40 trillion), real estates in various pockets of the country and solid multiplier effect of remittances by NRIs and IT and an IT-enabled service sector. Just imagine the kind of aggregate effective demand that could be created by over $60 billion earnings from IT and ITeS and over $40 billion net NRI remittances per annum, as they do not have any significant import intensity.

Results are already evident — India is set to post close to 7 per cent growth in the ongoing year — the second fastest among the major economies. These ingredients, coupled with a productivity level (Icor) of 4 per cent will enable India to revisit a fast economic growth over the next five years. The sectors to gain from this would be oil & gas, infrastructure, realty and materials, among others. The entrepreneurs managing these are already India’s richest people. The Indian equity market would reward one among them to emerge as the richest person in the world — and others would follow him in the top 10 list, bringing back India’s glorious period of the 16th century.