Gold import likely to fall to two-decade low on demand destruction

The reason for the demand destruction is a surge in prices and the subsequent lockdown, due to which footfalls at retail stores dropped significantly

Gold import in the calendar year 2020 (CY20) is expected to fall 50 per cent to nearly a 17-year low because of lacklustre demand since the Covid-19 outbreak in March and record-high prices. Experts estimate only 350 tonne of gold import this year, matching the 2003 figure.

The pandemic and lockdown have severely affected the jewellery industry and changed demand equations -- those interested in investing in gold have shifted to instruments, such as sovereign gold bonds and gold ETFs. Many others are, in fact, selling gold or using it as collateral to generate short-term liquidity. 

Despite demand destruction, the yellow metal