India's gold demand to be 19% lower at 800 tonnes in 2012: WGC
Chandigarh: The country's gold demand is expected to be almost 19 percent lower in 2012 compared to last year mainly due to subdued consumption during first two quarters, World Gold Council (WGC) said Wednesday.
The demand for gold in India is likely to be 800 tonnes by end of 2012 in comparison to 986 tonnes in 2011, said World Gold Council, Director Investment, Amresh Acharya told reporters Wednesday.
"During the first two quarters of this year, the demand for gold was low because of jewellers strike due to custom duty, weak monsoon, among other factors," said Acharya here.
Though the demand for gold has seen an upward movement during festival season this year, he said the demand for yellow metal was 600 tonnes during first three quarters of 2012 which was lower than 800 tonnes in corresponding period last year.
He further said the demand for gold in India surged sharply by 39 percent during 2006 till 2011. The gold demand rose to 986 tonnes in 2011 from 710 tonnes in 2006, he said.
India and China are contributing almost 50 percent of total gold consumption, he said.
"Emerging markets, central banks turning net buyers of gold and more and more people investing in gold due to economic crises are pushing up the gold demand," he said.
Asserting that India would always have sustainable long term demand for gold, he said the aggregate consumption of gold in India is expected to grow to USD 1.73 trillion by 2025 from USD 420 billion in 2006.
He said there is also supply constraint of gold.
About the impact on gold demand after RBI asking banks not to lend for purchase of gold, he said this directive is not going to affect the demand as banks have very small exposure towards gold.