First pan-India household gold consumption survey to be released in January

The India Gold Policy Center, a think tank at the Indian Institute of Ahmedabad sponsored by the World Gold Council, is likely to release the findings of its first pan-India household gold consumption survey in January.

Professor Arvind Sahay, chairperson of the center, told indoasiancommodities.com that the survey, which would become a bi-annual affair from the next year, would present the most comprehensive data on household gold consumption patterns in the country.

“The scale at which we are taking it up, it is the first exercise of its kind. Though gold is an important asset class for consumers in the country, the data on its consumption pattern largely remains fragmented. This survey would tend to fill that critical gap and our findings are expected to become useful for everybody in the value chain – including the government for policy modifications and traders for business decision making,” Sahay said.

Professor Arvind Sahay

In 2016, a household finance committee led by renowned economist Tarun Ramadorai had submitted a report which said that Indian households were putting away 9 percent of their investible money in gold. Consumption patterns formed a part of the report.

The IGPC report will focus solely on consumption, Sahay added.      

IGPC was keen to launch a bi-annual report from this year, but its plans were hit by the national lockdown triggered by the Covid-19 pandemic as it was difficult to collect data.

The sample size of the future IGPC surveys would usually be 200,000 households covering 25 states. The first survey round that is currently underway, however, is expected to focus on eliciting responses from 40,000 households mainly from India’s leading gold consuming states — Tamil Nadu, Kerala, Andhra Pradesh, Telangana, Karnataka and Maharashtra.

Cumulatively, these six states account for nearly 60 percent of the country’s total gold consumption.

The IGPC survey findings would be based on data collected on specific points like consumption behaviour around gold and gold related products, share of gold in total savings and investments portfolio of the household vis-à-vis total asset allocation, inherited holding vs purchase from own income, understanding its various forms of utilisation by households, millennials’ preference towards gold, etc.

“It would be focused more in understanding the current consumption pattern rather than looking at household gold holding volumes. It will have a broader purpose to understand why schemes like the Gold Monetisation Scheme (GMS) haven’t worked in this country which create a beneficial avenue especially for household investors and others in the value chain,” Sahay emphasized.

The historical and traditional obsession for gold among Indians is well known.

India along with China are top two gold consuming nation in the world. Unofficial estimates suggest a staggering 25,000 tonnes of gold is lying idle with Indian households even as rising gold imports in the pre-Covid years has been cited as a major contributor to the country’s growing trade deficit. 

Ritwik Sinha chased trucks in his childhood, without realising logistics would become a deep love for him. Inherently a television man, he now spends long hours interviewing key people for our very popular YouTube channel. Podcasts are next on his list. In his free time, Ritwik is either looking for a warehouse filled with commodities or hitching a ride on a cold truck – all of which yields great stories!

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