Home / Business and Economy / India's Reliance on Gold Imports Persists Amid Fluctuating Prices
India's Reliance on Gold Imports Persists Amid Fluctuating Prices
16 Oct
Summary
- India ranks second globally in gold consumption, heavily reliant on imports
- Domestic gold prices higher than international benchmarks due to additional taxes
- Global gold prices influenced by bond yields, central bank policies, and investor sentiment
As of October 17, 2025, India, the world's second-largest gold consumer after China, continues to rely heavily on imports to satisfy its domestic demand for the precious metal. Recycled gold accounts for only a small portion of the country's gold supply.
Since gold is priced internationally in US dollars, any fluctuations in the rupee-dollar exchange rate have a direct impact on local gold prices in India. Domestically, gold is generally more expensive than international benchmark rates due to additional levies, including import duties, Goods and Services Tax (GST), and various state-specific charges. These factors increase the cost of both jewelry and bullion for Indian buyers.
Globally, gold prices are shaped by a variety of factors, such as changes in bond yields, central bank monetary policies, and overall investor sentiment. The precious metal's long-standing status as a safe-haven asset keeps demand robust during periods of financial uncertainty or geopolitical tension.
