WGC Sees Boosted Indian Gold Demand Driven by Low Import Duty

SEATTLE (Scrap Monster): The World Gold Council (WGC), in its newly published report, says that lower import duty announced in the recent Union budget will help to boost demand for gold in India. The report titled ‘Union Budget Impact on Indian gold market’ also cited the government’s proposal to authorize the Securities and Exchange Board of India (SEBI) as gold market regulator as an additional factor that would lead to increased demand for the yellow metal in the country.

The announcement of schemes for rural areas in the Union Budget 2021-’22 is likely to boost incomes, which in turn may trigger gold market revival. The positive budget announcements will help recovery of gold demand in 2021, from the lows recorded during the previous year, said WGC report. The rural welfare schemes may indirectly support gold demand through income growth, it added.

As per data, the country witnessed drastic decline in illegal gold imports into the country in 2020, mainly due to logistical disruptions on account of Covid-19 pandemic. The situation is likely to remain more or less the same with some improvement in 2021. The WGC sees spurt in official gold imports, thanks to lowered import duty.