India spent a record $55.7 billion on gold imports in 2021: Report

Previously unreported details of rising imports from the world’s second-largest consumer country were disclosed to Reuters by a senior government official, who requested anonymity because he was not authorized to speak to the media.

According to an official tracking broader import trends, the gold import bill for 2021 easily doubled from the $22 billion spent in 2020, and surpassed the previous high of $53.9 billion in 2011.

In terms of quantity, India imported 1,050 tonnes of gold in 2021, the highest in a decade and far more than the 430 tonnes imported in 2020, the official said.

While global bullion prices were supported by strong demand in India, outlay on imports would have put pressure on the country’s ailing rupee.

Harshad Ajmera, a Kolkata-based gold wholesaler, said, “Last year the demand was strong as a lot of weddings were postponed from 2020 to 2020.

Indian authorities imposed strict lockdowns in 2020 during the first wave of the pandemic, hitting gold demand during the wedding season and major festivals such as Akshaya Tritiya considered auspicious to buy gold.

Gold is considered an essential part of a bride’s dowry in India, and is also a popular wedding gift.

Ajmera said the price correction made earlier last year has made gold more affordable for retail consumers in India.

Local gold prices hit a record high of Rs 56,191 ($754) per 10 grams in August 2020, but fell to Rs 43,320 in March 2021, when monthly imports hit a record 177 tonnes.

The government official said India imported 86 tonnes of gold in December, a slight increase from last year’s 84 tonnes.

A Mumbai-based bullion dealer said gold imports may drop in January as rising cases of coronavirus have prompted local authorities to impose restrictions.

The dealer said, “Jewelers are scared of the lockdown. They have stopped buying.”

This story has been published without modification in text from a wire agency feed. Only the title has been changed.