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Politicians shine brighter than gold in India

LiveMint logoLiveMint 29-05-2014 Gauri Karnik

Move over Warren Buffet. The Indian politician is here to give you a run for your money with his ability to grow his net worth despite a weak economy.

The slowing economy may have destroyed wealth of ordinary citizens over the past five years, but our politicians do not seem to have done too badly. The average wealth of politicians has grown faster during 2009-14 than in the previous five years even as India’s economic growth slowed between 2009 and 2014 compared with the previous five years. Growth in India’s gross domestic product slowed to 6.69% a year in 2009-14, after growing at an average annual pace of 8.4% in the previous five years.

A Mint analysis of the wealth of 123 politicians who have been members of parliament (MP) for the past 10 years shows their average wealth rose at an average annual pace of 24% during 2009-14, after growing at an average pace of 19% in 2004-09. In comparison, India’s richest family, the Ambanis (Mukesh and Anil Ambani put together) saw their wealth grow at an average annual pace of 7.6% to $33.9 billion (Rs2.06 trillion at the average exchange rate this year) in the past five years after galloping at an annual pace of 37.6% in the previous five years, according to data from Forbes magazine.

The 123 politicians analyzed, based on data from the Association of Democratic Reforms (ADR), include only those who have been Lok Sabha MPs for two consecutive terms and have contested elections this year. Their average wealth has grown at an average annual pace of 21.4% over the past decade, nearly twice the pace at which gold appreciated in value over the same period. The annual wealth increase of this set of politicians is also higher than the average annual returns of the 50-stock Nifty index on the National Stock Exchange, which rose at an annual pace of 14.2%.

Ironically, the MP who saw the greatest wealth appreciation over the past decade is a communist, Sushmita Bauri, who lost the election this year from her family pocket borough of Bishnupur in West Bengal. Kamal Nath of the Congress party, with a 44.6% annual growth in wealth, is third on the list of wealth growers behind Uday Singh of the Bharatiya Janata Party. Kishore Chandra Suryanarayana Deo Vyricherla of the Congress party, who lost from Aruku constituency in 2014, saw the greatest wealth depreciation among the 123 MPs analyzed. He saw his assets decline at an annual pace of 15.4%, the only MP to have seen a decrease in wealth.

The list of 123 MPs include 44 MPs who have consistently stood on a Congress ticket in the past three elections and 27 such MPs from the BJP. The average assets of BJP MPs grew faster than average at an annual pace of 28% while the average assets of Congress MPs grew in line with the average over the past decade at an annual pace of 21%.

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