Gold, silver imports surpass pre-Covid levels in Gujarat

AHMEDABAD: Backed by good sales fuelled by pent-up demand, improving incomes, weddings, and investment requirements gold and silver imports have surpassed pre-pandemic levels in the calendar year 2021. According to the data released by Ahmedabad Air Cargo Complex (AACC), about 42.1 metric tonnes (MT) of gold was imported into Gujarat in 2021, up 123% against 18.8 MT in 2020 and marginally higher than 41.79 MT in 2019.
Showing an even more bullish trend, silver imports stood at 319.4 MT in 2021, up sevenfold against 2020 and 1.5-fold against 2019.

The demand for both the precious metals remained buoyant through the year. “Despite the handsome gains from equity markets, a section of investors kept their faith in gold as a safe haven,” said Haresh Acharya, director, India Bullion and Jewellers’ Association (IBJA). Acharya added: “This propelled the demand for both bullion and jewellery. Several people invested in sovereign gold bonds and gold exchange traded funds (ETFs) as well which is not accounted for in the physical imports of gold.” He went on to say: “That apart, jewellery demand remained bullish too.”

The gold price touched Rs 49,700 per 10 gram on Saturday in the Ahmedabad market.
Acharya attributed the surge in demand to the gold prices which remained stable through the year. Moreover, a reduction in import duty of gold from 12.5% to 7.5% announced in the Union budget in February 2021 also boosted sales, he said.

Industry players said that investors were diverted to gold due to the lowered interest rates in banks as well.

With several weddings taking place, the pent-up demand for jewellery also worked well. Jigar Soni, president, Jewellers’ Association of Ahmedabad (JAA), said: “A lot of customers who had pending or deferred occasions organized them last year which propelled fresh purchases of gold.” He added: “People realized the importance of gold as a haven and therefore continued to invest in the form of jewellery during festival muhurats as well.”

As for silver, the demand was powered by investors. The silver price stood at Rs 64,300 per kg on Saturday in the Ahmedabad market. “Many invested in silver anticipating better returns. Silver prices are expected to go past the Rs 70,000 per kg level,” said Manoj Soni, an Ahmedabad-based jeweller. “Even lightweight silver jewellery sales grew during the festive season along with those of artefacts. As a result, silver demand shot up further.”

With higher demand for gold and silver, employment in the gems and jewellery sector has improved significantly as scores of artisans returned from their home states.

Courtesy: TOI