Monday, April 4, 2011

Indian Households Have 18,000 Tonnes Of Gold: Estimate

Indian imports of gold are quite large year by year, so it's not too surprising that Indian households would have accumulated a lot of gold. An estimate inside India: Heart of Gold, as excerpted by Commodity Online, says Indian households have 18,000 tonnes of gold. That's a lot of gold: at current market prices it amounts to more that 831 billion dollars. With all that gold, Indian households (collectively) could buy almost all of mainland China's holdings of U.S. Treasury debt.
Ajay Mitra, Managing Director, India and the Middle East, World Gold Council, said: "The rise of India as an economic power will continue to have gold at its heart. India already occupies a unique position in the world gold market and, as private wealth in India surges over the next ten years, so will Indian demand for gold".

"In parallel to growth, socio and demographic challenges will need to be addressed given its immense diversity. This also applies to the gold market. Nevertheless, gold purchasing will continue, underpinned by India's long-standing and deep cultural affinity for gold; a love affair which transcends generations and makes India unlike any other gold market"....
With the Indian economy expected to show rapid growth for the next several years, and with some of that growth spilling into villages and rural areas thanks to price rises in agricultural commodities, holdings are expected to keep growing at a nice clip.

There's a real and deep traditional bond between Indians and gold, making for a lot of demand when markets go well. Some government administrator who wished to pry their gold out of their hands might, in frustration, call the metal a barbarous relic...

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