The high price of gold combined with the imposition of a 1 percent excise duty and the 42-day jewellers’ strike protesting it as well as the requirement for consumers to enter the details of their income tax permanent account number (PAN) for any purchases above ₹2 lakh will keep Indian gold consumption to between 750- and 800 tonnes this year, according to the World Gold Council (WGC).
WGC India Managing Director Somasundaram P.R. told the PTI news agency that despite an improvement of demand in the second half of the year after a good monsoon (which is expected to boos rural demand), consumption would be well below last year’s 860 tonnes.
The WGC had reported in August that Indian gold demand over the first half of this year had fallen 30 percent to 247.4 tonnes from last year’s 351.5 tonnes. Somasundaram said, however, that the fundamentals for gold demand in India remained robust.