Home Insider The Race for Gold . China or India..?

The Race for Gold . China or India..?

In 2012, India’s consumers were buying more gold – jewellery, coins and bars – as they could get their hands on, even though record domestic prices were being hit because of the rupee’s value at the time, as well as the import curb.

A different story has emerged in 2013, as figures show a huge slump in consumption to 148 metric tonnes from July to September, a drop of 32 percent from the same period of the previous year, while in China it rose by 18 percent to 209.5 metric tonnes. This made China the world’s top gold consumer for the period.

It’s expected that China’s demand for gold, prompted by a change in import regulations and government policy, will continue its rise well into 2014. Predictions have estimated it could rise as high as 1,000 metric tonnes for the year.

Between China and India, they account for half of the world’s demand for gold and their joint purchases affect global gold prices, along with the strength or weakness of the US economy. A report from the World Gold Council said that, in 2013, Chinese consumers purchased nearly 798 metric tonnes, whilst Indian consumer figures dropped to 715.7 metric tonnes. This was attributed to the Indian government’s increase on import taxes and the introduction of an import curb. – plus, Indian gold importers now have to re-export 20 percent of the gold they bring in.

n the third quarter of 2013, Chinese demand for gold coins and bars was 12 percent higher than the previous year at 47.9 metric tonnes. At the same time, China’s consumption of jewellery rose 29 percent in the third quarter to 163.8 million metric tonnes, emphasising China’s place as the world’s largest consumer of gold.