Decade of Gold for Indians – Investment Rises

September 8, 2010 · Author: · Category: exim 

India’s traditional love for Gold is well known. Over the last five years the relationship has become even more intense despite the sharp rise in Gold prices. Over the last three years, average annual investment in Gold has been of the order of US$20 bn…higher than that in ULIPs and substantially higher than that in equity linked mutual funds.

Demand is price elastic over the short term. A sharp increase in Gold prices has typically been followed by a decline in imports. This is particularly true when the annualized price increase is more than 30%. But over the medium to long term the relationship has endured.

The following Chart Shows th1 10 Year Historical Gold import Data by Indians.
In the last 5 years, Indians as well as Investors / Hedge Funds have parked their funds in safe heavens “Gold”. And the following Chart shows the Amount, Indians Spent Importing Gold.

Update – Oct-04Some more facts about Gold in India,
Morgan Stanley in a Report said,

The stock of gold with Indian households is about 15,000-20,000 tonnes, accounting for about 10–13% of the world’s stock. This would translate into a market value roughly US$600-800 billion.

Gold Lending & Borrowing in India:
10% of India’s Gold stock has been lent against. About 8% (of this 10%) is controlled by the unorganized sector. Lending
against gold has historically been controlled by the unorganized sector – money lenders and pawn shops. A loan against gold typically has a loan-to-value between 60-85%, average maturity of three months and yields between 12-36%.

Comments

3 Responses to “Decade of Gold for Indians – Investment Rises”

  1. Comparison of Investment in Gold Vs Equity in India | Dalal Street on September 8th, 2010 10:33

    […] Obsession towards Gold has increased in the past 5 years despite rising prices. Data suggests that demand for Gold has been secular and is not linked to either inflation or alternative […]

  2. Pushpendra Jain on October 17th, 2011 13:47

    can u pls provide me last 10years historical price of gold with dates???

  3. Himanshu Garg on November 8th, 2011 19:29

    plz provide me the lowest and highest price of gold in rupee.. year wise from 2005 to 2010

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