India's Gold: Unlock Hoards, Cut Imports

India faces a significant opportunity to reduce its dependence on gold imports by enhancing domestic recycling efforts. An estimated 31,000 tonnes of gold are held within Indian households, representing a vast untapped resource. By creating a more appealing gold monetization scheme, the country can encourage citizens to bring this metal into the formal economy.

This increased recycling not only substitutes a portion of the approximately 800 tonnes of gold imported annually but also addresses the underutilization of India's substantial refining capacity, which stands at 1,800 tonnes. Reviving this capacity through recycled gold could strengthen the national economy and alleviate pressure on the current-account deficit. The future of India's gold sector hinges on responsibly and efficiently monetizing its existing domestic holdings.