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Notwithstanding the sharp fall in prices, gold demand in 2015 was up just three per cent last year at 849 tonnes against 828 tonnes in 2014.
Jewellery demand was up five per cent at 654 tonnes (622 tonnes) while investment in gold was down six per cent at 195 tonnes (207 tonnes), according to the World Gold Council report released on Thursday.
In value terms, jewellery demand was at ₹1.56 lakh crore – a rise of one per cent while that of investment demand was down nine per cent at ₹46,515 crore (₹51,382 crore).
Somasundaram PR, Managing Director, World Gold Council, said though demand for gold picked up sharply in the second half of last year it could not make up for the slump suffered in the first half as the prices continued to fall.
However, he said gold has once again proven resilient in the face of a range of challenges, underlining the role of gold as an essential component of households’ savings and reinforcing the need to bring gold into the financial infrastructure.
On his expectations from the Budget, Somasundaram said the Centre should remove the uncertainty on customs duty cut and prepare the industry for Goods and Service Tax.
Of the total imports, 25 per cent was in dore (semi-pure form of gold) thus supporting investment in refinery. While importers have to pay 10 per cent import duty on gold, it is nine per cent on dore which includes eight per cent customs duty and one per cent excise duty.
“The one per cent duty difference has bought in significant value-addition into the country and attracted investment in refinery and allied infrastructure,” he said.
Gold imports into the country in 2015 were at 897 tonnes against 891 tonnes in 2014, while dore imports were at 223 tonnes. Last year, gold recycling was down at 80.2 tonnes (92 tonnes) due to lower prices.
In December quarter, gold demand was at 233 tonnes up six per cent compared to same period last year, valued at ₹54,690 crore (₹52,500 crore).
Jewellery demand increased by similar percentage points to 173 tonnes. In value terms, jewellery demand was up four per cent at ₹40,595 crore. Imports were down 16 per cent at 234 tonnes (279 tonnes).
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