Indian household savings may channel $9.5 trillion: Report
Mumbai
India’s households could channel nearly $9.5 trillion into financial assets over the next decade, according to a new Goldman Sachs report, marking a decisive shift away from traditional investments such as gold and real estate. The investment bank forecasts that household financial savings will average 13% of GDP in the coming ten years, up from 11.6% in the previous decade.
The report highlights a growing preference among Indian savers for financial instruments. Over $4 trillion is projected to flow into long-term products like pensions, retirement funds, and insurance, while bank deposits could attract $3.5 trillion. Equities and mutual funds may together see inflows of around $0.8 trillion.
Goldman Sachs noted that the pattern mirrors trends in advanced economies, where rising incomes and deeper financial systems encourage households to allocate more towards pensions, insurance, and capital markets. In contrast, emerging markets have historically concentrated savings in physical assets.
The report underscored three major implications of this shift. First, increased household savings will provide a steady domestic funding source for corporate investment, reducing dependence on external capital and limiting strain on the current account deficit. Second, higher inflows could strengthen India’s long-duration bond market, stabilizing sovereign yields and enabling longer-tenure corporate bonds for infrastructure financing. Third, rising financial savings are expected to expand retail participation in capital markets, spurring demand for wealth management services.
The shift, however, will depend on income growth, inflation trends, risk appetite, and interest rates. Despite near-term household financial pressures, India’s economy grew 6.5% in FY25, underscoring resilience and the long-term opportunity for financial deepening.
