The love for gold in India can be witnessed from time immemorial in most of the historical events. Gold, the precious yellow metal is considered as an auspicious thing and is a must in most of the weddings even today across all the religions, caste, creed, geography in India.
The country occupies the second position in terms of annual consumption of gold in the world followed by China. It is considered as an asset which can be used during financial difficulties and at the same time it is seen as a status symbol. People display their wealth by wearing heavy ornaments made of gold during festival occasions and ceremonies.
As per the recent report from the World Gold Council, the demand for gold in India has declined marginally by 1.40 per cent to settle at 760.40 tonnes during fiscal 2018 owing to high prices added with some measures from the government. The report also notes that the global consumption of the jewellery metal has gone up by 4 per cent during the same period which has helped the precious metal to gain a stronghold in the overseas market against the U.S. dollar.
The country had consumed close to 771.2 tonnes of gold during fiscal 2017. The transparency measures introduced by the Indian government along with the GST charges on gold ornaments has led to the fall in its demand in the local market.
India occupies 11th position in terms of the gold reserve with a current holding of 607 tonnes as per the recent reports. The United States of America holds the first place in terms of gold reserves with a whopping 8,133.5 tonnes followed by the European country - Germany, with 3,369.7 tonnes of yellow metal held as reserves.
In the Asian sub-continent, China and Japan hold more gold reserves compared to India with each holding 1,864.3 tonnes and 765.2 tonnes respectively.
Currently, the demand for gold is concentrated only amongst the emerging markets Central Banks amidst the ongoing geopolitical and economic uncertainty. Adding further fuel to the existing problem is the slowing down of the global economy which has gripped nervousness amongst the investor community.