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Indian households have record gold hoard of Rs 24,000 tonnes worth $800 bn: WGC Report

Gold IndiaThe World Gold Council has released a comprehensive report on the Indian Gold Market announcing that Indian households are the world’s largest hoarders of gold. They hold a record 23,000-24,000 tonnes of Gold worth of at least $800 billion. The value would be substantially higher in the rupee term.

The central bank of India has around 557.7 tonnes of Gold stocks. India is the world’s second largest Gold consumer representing around a half of its gross domestic product. This clearly indicates that the gold monetization scheme can be a massive success if some incentives are attached to it.

India’s Gold demand has declined substantially since the demonetization as people feared crackdown on gold holding as well. However WGC expect strong prospect for Gold with average demand expectation for the country. India’s gold demand has fallen to a seven-year low of 650-750 tonnes in 2016.

WGC managing director (India) Somasundaram PR said demonetization could be a game changer if proper awareness of the benefits of the move are understood. It will expand the tax base and the positive impact on public finances could generate a more benign and supportive policy government approach towards gold.

The demonetization of large notes has increased the transparency in the gold value chain. The introduction of the Goods and Services Tax and mandatory hallmarking as well as non-cash payments should make gold trade more transparent.

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