The rising trend in gold imports by India will be good news for the UAE, which is the second-largest exporter of the yellow metal to the South Asian country. In volume terms, India’s imports were estimated at 91 tonnes last month, compared to 12 tonnes in September 2020, according to a report in Arabian Business.
“Gold imports by India are set to surpass the pre-pandemic levels as we expect a significant rise in the imports of gold in the remaining three months of this year,” said Surendra Mehta, national secretary of Indian Bullion and Jewellers Association (IBJA).
According to the report, traders and retailers are said to be restocking in large volumes ahead of the upcoming festive and wedding season, after a major slump in demand due to the pandemic-induced market and mobility restrictions and rising gold prices internationally in most of 2020 and the early part of this year.
Prices of 22-carat gold have softened to $624 per 10 gms currently from a high of $695 a year ago. Besides the rising demand for jewellery, the market is expecting a major jump in demand for bullion as investors are expected to divert their investments from equity and bond markets because of expectations of a rise in gold prices globally on the back of firming up of inflation in most major countries.
Lowering of imports duty by India is another factor, which is seen pushing up gold imports to the country. India announced a cut in the import duty for the yellow metal in this year’s budget from 12.5 per cent to an effective 10 per cent.
Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished
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