1 month ago
India’s Gold Demand Falls 6% Despite Record Spending
In the second quarter of 2026, India bought less gold than it did a year earlier, dropping 6% to 131.4 tonnes.
Even though fewer tonnes were bought, the money spent on gold jumped 50% to about 1.98 lakh crore rupees because prices were higher.
The drop happened because the season for buying gold was weak, the government raised the import duty by 15%, and the prime minister asked people to buy less gold.
Jewellery sales fell 15% to 75 tonnes, and people were less interested in buying gold for investment, especially gold ETFs.
The government is worried that the higher duty might encourage smuggling, and police seized more gold in May‑June than in the previous month.
India’s gold demand fell 6% YoY to 131.4 tonnes in Q2 2026.
Value of gold consumption rose 50% to Rs 1.98 lakh crore despite lower volumes.
Decline driven by subdued buying season, 15% customs duty hike, and PM Modi’s appeal to curb non‑essential purchases.
Jewellery demand dropped 15% to 75.1 tonnes; investment demand softened, gold ETF inflows fell 80% from Q1.
Customs duty hike raised concerns about smuggling; enforcement seized 160.91 kg gold in May‑June, double the previous period.
- Who
- India, World Gold Council, Sachin Jain, Prime Minister Narendra Modi
- What
- Gold demand fell 6% YoY while consumption value rose 50%
- Where
- India
- When
- April‑June quarter 2026
- Why
- Higher prices, 15% customs duty hike, subdued buying season, and Modi’s appeal to curb non‑essential purchases
Key facts
- Gold demand (tonnes)
- 131.4
- Value of consumption (Rs crore)
- 1.98 lakh
- Import duty increase
- 15%
- Jewellery demand (tonnes)
- 75.1
- Gold ETF inflows (tonnes)
- 4.2
Quotes
Sachin Jain
Chief executive of World Gold Council's Indian operations
“The arbitrage is so huge. I mean, with the 15% duty and 3% GST, there’s an 18% difference, and that almost spurs an entire industry”
financialexpress.com
“Grey‑market inflows and the disruption they cause are hurting organised players”
financialexpress.com











