Gold imports steady despite high prices

India’s gold imports in 2008 are likely to remain steady, year-on-year, at around 800 tonnes despite high prices because it is the only financial asset that has proved its mettle amid turbulent times, Dharmesh Sodah, director, World Gold Council (WGC) said.

“Although the demand for gold jewellery was down in first six months due to high prices, we saw good recovery in imports in August and early September. I am confident that buying will pick up in the rest of the year due to marriage and festive season,” he said.

India imported 797 tonnes gold last year on very good demand for jewellery and also because of investment in bars, according to WGC data. However, the combined demand declined by 47 per cent in the first-half of current year to 264 tonnes, mainly because of high gold prices, WGC said.

Global gold prices had touched a record $1,033 an ounce in March.

India’s appetite for gold is constant. Consumers have only postponed their buying decision, which will materialise during the festive season, Sodah said.

Also, when all other asset classes like equities, real estate, and global currencies are passing through turbulent times, gold is the only asset in which people will put their money, he said.

“Gold is the only financial asset that stands on its own in (economic) difficulties,” Sodah said.

Sodah was speaking on the sidelines of launch of WGC-endorsed ‘Lucky Lakshmi’ gold festival by All India Gem & Jewellery Trade Federation here.

Lucky Lakshmi gold jewellery festival will begin Tuesday in 22 states across the country and last until November 3.

The festival is expected to generate turnover of Rs 6,000 crore, compared with Rs 3,000 crore garnered last year.