India, the world’s second largest consumer of gold jewellery, has experienced rapid change over the last few years due to evolving demographics. Weddings and festivals remain the most important drivers of Indian gold jewellery demand: bridal jewellery alone accounts for at least half of the market share.
Over the long term, gold jewellery demand in India will be driven by developments in economic growth, income growth and wealth distribution, as well as the rate of urbanisation. World Gold Council said recently in their, India’s Gold Market, Reform and growth Report & insisted upon the need to develop new markets for gold jewellery exports.
India’s gold jewellery exports have grown over the years, rising from US$7.6bn in 2015 to US$12.4bn in 2019, before the pandemic impacted the trade in 2020. Looking ahead, there is a greater need for Indian gold jewellery exporters to develop new markets; currently, nearly 90% of exports go to just five countries.
But a boost could come in the form of further proposals that will allow advance payments to overseas precious metal suppliers, as well as the formation of the Mega Common Facility Centres (CFCs) in the Santacruz Electronics Export Processing Zones (SEEPZ) of Mumbai and Surat.