Gold seems to be shining again for Indian exporters as the country’s exports of the yellow metal posted a massive 1,800 percent jump to $1.16 billion during April-May period of this year from a meagre $61.29 million in the same period last year, according to latest data by an industry body.
The South Asian country’s import of gold also posted a 1,047 percent increase to $7.88bn during the April-June period from $687.83m in the corresponding period of 2020, according to the federal commerce ministry data.
The ministry data does not provide a segregated figure for the country’s gold exports but gives only the combined export figure for gems and gold.
Gold is a major item in India’s import and export baskets to the UAE.
The UAE accounts for over 75 percent of India’s gold jewellery exports, while it is the second largest exporter of gold to the South Asian country.
Industry experts said the latest trade data on gold signalled a turnaround in the precious metal trade as the second Covid-19 wave ebbs in the country and also a demand pick up in Dubai, its largest export market.
“Things are getting better across the world post-pandemic, and this is resulting in growth of export [of gold], ” Surendra Mehta, national secretary of Indian Bullion and Jewellers Association (IBJA), told Arabian Business.
“With the vaccination rates going up and the major threat of Delta variant receding, the export of gold jewellery will further improve,” Mehta said.
According to the data by India’s trade body Gem and Jewellery Export Promotion Council (GJEPC), the $1.16bn gold jewellery exports during April-May was still 48 percent less than the $2 billion exports in the same period of 2019 – the pre-pandemic period.
Jewellery exporters said last year April to June 20 was in complete lockdown all across the world and hence export of gold jewellery was seriously affected.
The gold exporters’ trade body also said the rising trend in gold jewellery exports is expected to continue in the remaining period of the year.
“If we could cross Diwali – the Indian Hindu festival of lights – smoothly, last year’s vacuum of shortage of gold will easily be filled up,” Mehta said.
Traders said with the rise in exports, India’s gold imports will also pick up in the coming months to meet the rising demand – both for domestic sale and exports.After a prolonged period of decline due to the combined effect of record high prices and pandemic-induced mobility and trading restrictions, India’s gold demand recovered during the January-March period to witness a growth of 37 percent at 140 tonne compared to the same quarter of 2020.
The World Gold Council attributed the reasons for the recovery to the ease of Covid-related restrictions, pent up demand and softening of prices of the yellow metal.
Gold prices in India for 22 carat currently hover around $635 for 10 gm, much below from the record $700 level in July 2020.
The gems and gold industry suffered heavily last year when India imposed one of the strictest lockdowns after the breakout of the first wave of the pandemic in the country.
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