Christmas is a time for family but for most kids, a time for gifting. With Christmas just a few days away, we are looking at the most extravagant gift high networth Indians are giving their kids this year, a new citizenship pathway.
Why a second citizenship ?
A new citizenship opens you to receiving the benefits and privileges offered by each country where you are a citizen. For example, you may travel to receive medical treatment, employment, business opportunities or procedures that are not available in the other country of citizenship by birth. You can also receive an education at the same price as domestic students.
Over six lakh Indians have given up their citizenship in the last five years. Majority of the 40% citizenship renunciation requests have come from the United States, followed by Australia and Canada, which amount to a chunk of around 30% of such requests, according to data available by the ministry of external affairs.
India does not offer dual citizenship so people seeking citizenship in other countries must give up their Indian passport as per law. Indians who renounce their Indian citizenship can still apply for an Overseas Citizen of India (OCI) card, which would enable them to enjoy the benefits of residing, working or running a business in India. According to MHA, a total of 191,609 foreigners registered as OCI cardholders in 2020.
This also means that those Indians who are looking for ‘citizenship by investment’, will have to give up their India passports.
Over 7,000 Indian millionaires exited India in 2019 before the pandemic according to immigration reports. In fact, Indians have even topped a list compiled by the London-headquartered global citizenship and residence advisory Henley & Partners (H&P), of those seeking citizenship or residency in other countries in return for monetary investments. Countries like Portugal that run a ‘golden visa’ programme as well as countries like Malta and Cyprus are preferred destinations for India’s well heeled, according to H&P.
Compared with 2019, there was a 63% rise in the number of queries made by Indians over the ‘citizenship by investment’ category, with the top investment-linked residency programmes being led by Portugal, Canada and Austria.
Why are Wealthy Indians gifting a Golden visa to their children ?
A Golden Visa is a citizenship-by-investment or residency-by-investment program aimed at attracting wealthy foreign nationals who want to acquire residency in a certain country by investing a substantial amount of money or by purchasing a property.
European residence-by-investment migration programs like Malta, Portugal, Greece, and other European Golden Visas have gained traction.
Families are now becoming aware that for 250k Euros, you can buy a house in Greece and at the same time get a Schengen residency through which they can also have visa-free access to 26 Schengen Zone countries and same goes for the Portugal Golden Visa at only 280k Euros.
According to the Henley Passport Index, the Indian passport is currently ranked 85th, offering visa-free/visa-on-arrival access to just 58 destinations.
In the last 10 years, India has only improved its visa-free score (the number of countries you can visit without a visa or get visa on arrival if you have an Indian passport) by five (from 53 in 2011). But a Greece or Portugal residency card could provide Indians visa-free travel across the Schengen countries, effectively upping their visa-free score to 84 and even more once they qualify for the new citizenship.
The higher the passport index ranking, the better access one gets to travel visa-free to many countries. They are also exempted from bureaucratic delays in the immigration process which is beneficial for traders and businessmen.
“The unexpected events of 2020 have simultaneously exacerbated push factors such as political and economic instability, and reprioritized pull factors, with stability, safety, and access to education and healthcare becoming issues of greater concern than ever,” said Dr Juerg Steffen, the CEO of Henley and Partners, in a report.
He added that in terms of enquiries about the golden visa, India remains at the top in 2020, but the combination of Covid-19 and sustained political turmoil saw the US, which was in 6th position last year, shoot up into 2nd place (as it plunged down the Henley Passport Index rankings), followed by Pakistan, Nigeria, and South Africa.
For many countries with low-ranking passports on the Henley Passport Index, proliferating barriers to entry into desired countries are hindering progress, even as many reopen their borders in desperate bids to reboot economic growth.
In fact this is when investment migration programs can offer stability. “For the countries that are able to offer these programs, the security they provide acts as a safeguard against the economic volatility that continues to wreak havoc across the world. For more and more people, it is self-evident that acquiring a second citizenship or alternative residence, or both, is a foundational building block for a safe and stable future,” said Dr. Juerg Steffen, CEO of Henley & Partners.
In this regard, wealthy Indians are gifting their children Golden Visas to ensure access to economic and politically stable economies as well as the benefits of affordable education, good healthcare and ease of mobiity for their lifetime.
How Does Nova Quinta Help?
An experienced investment migration firm can assist people interested in legally obtaining a second residency or passport in several ways. Firstly, they can help identify the best residency or citizenship by investment program for an individual and their family, based on their exact situation. When evaluating countries, there is more to be considered than just the program’s investment criteria. Can eligible real estate be resold under the program? How long does the investor need to maintain ownership of the property? Do approved real estate projects in the country offer freehold units for sale, or just shares in the development? Is financing permitted and available? Does the jurisdiction allow you to include adult children, siblings, or parents in your citizenship application? How many economic passports has the country issued in the last decade? Are processing fees discounted for applicants making a donation instead of buying real estate? Does the nation’s passport provide visa-free access to the countries you primarily wish to travel to? Are there any restrictions that could prevent you from applying to the program, such as the exclusion of citizens of certain countries, health or criminal history?
Once you have decided on the ideal program, an investment migration firm can represent you throughout the entire procurement process. Many investors retain a firm located outside of the jurisdiction in which they will be investing to ensure they are best protected throughout the process and most preferably a firm in their current country of citizenship. We can perform due diligence, complete necessary applications forms, and ensure you have all the correct supporting documentation required by the program. We can also negotiate with property developers, handle official government communication on your behalf, review necessary financial agreements before you sign them, and represent your best interests while working alongside a local agent in that country.
Wondering how we can help you obtain a second residency or citizenship through investment? Contact us today for a confidential consultation.