India's Gold Investments Jump 60% to Rs 1.5 Lakh Crore in 2024: Report

Investments in gold in India rose by a significant 60 per cent in value terms in 2024 to $18 billion, or approximately Rs 1.5 lakh crore, compared with the previous year, said a report on Wednesday.

According to a World Gold Council report, this added that investment demand in gold was at its highest level since 2013, at 239 tonnes, and was a 29% increase from 185 tonnes recorded in 2023.

The yellow metal investment remained strong in the October-December quarter, with demand reaching 76 tonnes, nearly matching the previous quarter’s performance, the report said.

At 239 tonnes, the country's gold investment accounted for 20 per cent of the global demand in this category, which stood at 1,180 tonnes in 2024.

The worldwide demand also grew by 25 per cent compared to 945.5 tonnes in 2023.

The WGC report says that the main cause of the spurt was the steady increase in gold prices throughout the year.

After the import duty was cut in July, prices started rising again.

A correction in November attracted investors looking for an opportunity to buy at lower prices.

The festive season of Dhanteras and Diwali in October and November also played a key role in boosting gold purchases.

The report further added that major metropolitan cities experienced increased buying because of the rapid delivery of small gold investment bars and coins by e-commerce platforms, sometimes even within 10-15 minutes.

Another factor that worked in favor of gold was the weaker performance of other assets. Domestic stock markets, which gave average returns in the first half of the year, ended 2024 with a notable decline after hitting record highs in the third quarter.

The demand for gold is likely to expand to include gold exchange-traded funds (ETFs) and mutual funds, the report said.

After falling to a four-year low of 3,080 tonnes in April, gold ETF holdings rose throughout the rest of the year except for a decline in November.

According to the report, these increases are largely due to increasing geopolitical uncertainties, shifting expectations of interest rates, and gold's best annual price performance since 2010.