India's millionaire population is growing like crazy — and so is its luxury market

Russia and China are having their day, but we may now be entering "India's decade," according to a new report by wealth intelligence agency Wealth-X. 

Following India's election of a new reformist government, there are three main factors propelling its rapidly growing luxury market. 

1. Its millionaire population is growing like crazy. 

The number of millionaires in the country has risen from 196,000 to 250,000, an increase of 27%, in the past year. Wealth-X predicts 437,000 India-based millionaires by 2018, and double that amount by 2023.

The key indicators for India's future economic growth are its new reformist government, well-defined legal system, and entrepreneurial spirit, according to Wealth-X. 

The report also notes that luxury consumption and economic inequality is more acceptable in India than in China or Brazil, on account of the country's long-standing but now-defunct caste system.

2. High-end retail space will double and luxury imports are already on the rise. 

Recent years have seen an increase in luxury consumption in India. Notably, Champagne imports have risen by 6%, while general imports into the country have remained relatively flat.

Retail space for luxury brands is set to double in the next three to four years, according to a a report by CBRE Group, the world's largest commercial real estate firm. Developments in major cities like Delhi, Mumbai, Chennai, and Bengaluru will add an expected 16 million square feet of commercial space, with luxury retailers taking an estimated one to two million square feet.

3. Luxury car sales are predicted to triple. 

Luxury automakers are also projected to pounce on India's burgeoning upper middle class. Car sales are set to triple from 33,000 a year to over 100,000 by 2020, according to a report by credit agency ICRA.

The report says it finds "a strong correlation between incremental affluent households and luxury car sales," and as India generates more affluent households, luxury cars sales will also climb.