The World Gold Council acknowledges the announcement made today in the Union Budget by theIndian government, to further increase customs duty on imports of gold to 4% from 2%.
While there may be a very short-term impact to demand for gold as a result of this measure, we believe that in the longer term, this increase will not substantially affect demand.
The fundamental reasons for buying gold jewellery are unchanged. They are rooted in Indian culture and weddings. Investment demand is driven by the need to protect against inflation, ease of liquidity and the increasing use of gold as a monetised asset to secure loans.”
--Ajay Mitra, Managing Director, India and Middle East, World Gold Council
