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Gold imports in India surged to USD 22.70 billion during the April-August 2024 period, up from USD 18.14 billion in the same period last year, driven by increased demand. Increase is gold imports is cited to increased buying by central bank, jewellers buying for increased demand for the festive season and a reduction in duty in the union budget.
The spike in imports reflects the growing appetite for gold in India, as consumers prepare for the festive and wedding season, traditionally peak times for gold purchases. In contrast, India's export of gems and jewellery declined to USD 11.10 billion in April-August 2024, compared to USD 12.43 billion during the same period in 2023. This dip comes even as the domestic demand for jewellery remains strong, driven by rising gold imports and changing consumer buying patterns. The jewellery market in India has seen notable shifts in buying trends in 2024. A recent report by Nuvama highlights that while affluent buyers dominated jewellery purchases in the first quarter of the year, the second quarter saw an increase in demand for lower-priced jewellery items, particularly from semi-urban and rural markets. This shift has broadened the customer base and contributed to sustained growth in the overall jewellery market. As the country gears up for the festive season, retailers have been expanding their store networks to cater to the growing demand. The Nuvama report predicts a potential 18 per cent increase in volume demand for jewellery in the second half of 2024, offering a positive outlook for the sector. Gold imports, a key indicator of the jewellery sector's health, have been on the rise. In July and August 2024, gold imports were 11 per cent higher than in the same period last year, showing a strong recovery in demand. The recent reduction in basic customs duty on gold, announced in the July Union Budget, has further boosted the domestic gold market, ending a five-month period during which gold was trading at a discount due to excess inventory and weak demand. The recent surge in Gold prices is not deterring the demand, currently the prices stands 30 per cent higher than the average levels recorded in the second half of 2023. This price rise is further fuelled by continued gold buying by central banks, which has driven both price and volume growth in the market. The July-August period shows a positive sign of growth, and with the peak wedding season approaching, the demand for jewellery is likely to rise further. The World Gold Council (WGC) has projected that gold demand in India for the calendar year 2024 will reach 850 tonnes, marking a 12 per cent year-on-year growth. The combination of a strong festive season, increased central bank buying, and reduced customs duties is expected to bolster the domestic gold and jewellery markets in the coming months. (ANI)
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