The Indian gold industry is an important part of the country’s economy, contributing 1.3% to Indian GDP. Although still fragmented, the industry has become more organized and regulated over the last few years. Chain stores have gained market share at the expense of stand-alone retailers, increasing their share to 35% by 2021.
The Indian government has implemented several measures to formalize the economy, streamline taxes, improve compliance, and reduce reliance on cash transactions, such as demonetization and the Goods and Services Tax (GST). Demonetization pushed the growth of digital and banking transactions, but it also negatively impacted the unorganized sector in the short to medium term. GST standardized tax rates and reduced business costs, benefiting interstate business transactions the most.
The impact of GST on the jewelry trade is notable, as it changed the way manufacturers and retailers transact with each other. Retailers now rely on either job work or outright purchases of jewelry from fabricators, and a large part of the bullion remains on the manufacturers’ books. The elimination of local levies such as VAT allows retailers to purchase bullion from any state and benefit from online apps that have introduced greater pricing transparency. However, compliance costs have increased, and the GST negatively impacted retail gold bar and coin purchases.
Consumers traditionally accumulate gold over time and convert it into jewelry later, but under the GST regime, they pay double tax when exchanging bullion for jewelry. The Sovereign Gold Bond (SGB) has benefited from this shift away from bar and coin purchases, but it is not a physically backed asset. A GST rate of 1.25% is considered ideal for the gold trade, given that gold is an investment asset, and the customs duty on gold is already high.
India responsible for almost 29% of the global jewelry consumption.
The Indian jewelry market is expected to reach $100 billion by 2024, . The market is split between products for women, children, and men, with Indian consumers preferring domestic brands such as Tanishq, Kalyan Jewellers, PC Jeweller, and Joyalukkas. Wedding jewelry accounts for over 50% of all jewelry sales in India, with Indian brides wearing jewelry from head to toe on their big day. Indian consumers prefer gold and diamonds, with gold symbolizing prosperity and long-term commitment and diamonds gaining popularity since 2013. Even high-income jewelry consumers in India place much importance on the actual materials than on the brands themselves. Online shopping and product discovery are developing in India, with e-commerce gaining ground, and consumers aged 18 to 45 representing about 70-80% of online shoppers. Additionally, lab-grown diamonds are gaining traction in the Indian market, and customization and personalization of jewelry are growing trends. India is the world’s second-largest consumer of gold, and according to the World Gold Council, it has become a ‘strong pillar of support for the global gold markets’.
The demand for lightweight and studded jewelry has been on the rise in India.
With bridal jewelry dominating the gold jewelry landscape and plain gold jewelry maintaining the majority of the market share. India’s gold jewelry exports have grown steadily over the years, with bridal jewelry accounting for 50-55% of the market share. South India is the dominant region for gold jewelry consumption in the country, accounting for 40% of the total jewelry demand. India also has a significant silver jewelry market and is the world’s largest fabricator of silver jewelry.
A 2019 survey conducted by Hall & Partners found that 60% of women in India owned gold jewelry, followed by 57% who owned silver jewelry, and only 26% who owned diamond jewelry. India was the largest consumer of gold before being overtaken by China in 2009. In 2021, India bought 611t of gold jewelry, second only to China (673t) but ahead of all other gold-consuming markets.
Financing remains a crucial challenge for the industry, particularly for smaller independent jewelers, who rely on the monthly gold scheme for funding or who act as money lenders. The manufacturing industry remains fragmented, with only 15-20% of units operating as organized and large-scale facilities. However, jewelry parks are being established to help address ethical concerns and working conditions for artisans. Going forward, national and regional chain stores are expected to continue to gain market share, while organized manufacturers will see their market share grow as many large players limit themselves to working only with organized manufacturers.
Top 10 chain stores in India.
| Name | Stores | Cities/Towns | Company description |
|---|---|---|---|
| Tanishq (including Zoya) | 382 | 209 | Tanishq is a well-known Indian jewellery brand that was launched in 1994 by the Tata Group. It offers a wide range of gold, diamond, and platinum jewellery for men, women, and children. Tanishq is known for its exquisite designs and craftsmanship, and it has become a popular brand among Indian consumers. Zoya, on the other hand, is a sub-brand of Tanishq that offers luxury diamond jewelry. Zoya is known for its high-end designs and exclusive collections, and it targets affluent consumers who are looking for unique and exquisite jewelry pieces. Tanishq and Zoya have a strong presence in India and have expanded to several countries around the world. They have won several awards for their designs and craftsmanship, and their products are highly regarded by consumers and critics alike. |
| Malabar Gold and Diamonds | 150 | 111 | Malabar Gold and Diamonds is a prominent jewelry brand that was founded in Kerala, India in 1993. It has since become one of the largest jewellery retailers in India, with over 250 showrooms across the country, as well as in the Middle East, Southeast Asia, and the US. Malabar Gold and Diamonds offers a wide range of gold, diamond, platinum, and silver jewelry, including traditional Indian designs as well as contemporary styles. The brand is known for its high-quality craftsmanship and use of the finest materials, and it has won several awards for its designs and customer service. In addition to jewelry, Malabar Gold and Diamonds also offers gold coins and bars, as well as other gift items such as watches, perfumes, and accessories. The brand is committed to ethical and sustainable practices and sources its materials from trusted suppliers. Overall, Malabar Gold and Diamonds has built a strong reputation for its quality products and customer service, and it remains a popular choice for consumers in India and beyond. |
| Senco Gold and Diamonds | 126 | 85 | Senco Gold and Diamonds is a well-known jewellery brand that originated in Kolkata, India in 1994. It offers a wide range of gold, diamond, and other precious stone jewellery for men, women, and children, as well as bridal jewellery sets. Senco Gold and Diamonds is known for its unique and intricate designs, which incorporate both traditional Indian styles as well as contemporary elements. The brand is also committed to using high-quality materials and the latest technology to ensure the durability and longevity of its products. In addition to jewellery, Senco Gold and Diamonds also offers gold coins, bars, and other gift items such as silverware and accessories. The brand has a strong presence in eastern India and has expanded to other regions of the country as well. Senco Gold and Diamonds has won several awards for its designs and customer service, and it is widely regarded as a trusted and reliable brand by consumers. The company also has a strong commitment to social responsibility and supports several charitable initiatives in the areas of education, healthcare, and community development. |
| Kalyan Jewellers | 116 | 87 | Kalyan Jewellers is a prominent jewellery brand that was founded in Kerala, India in 1993. It has since become one of the largest jewellery retailers in India, with over 150 showrooms across the country, as well as in the Middle East and Southeast Asia. Kalyan Jewellers offers a wide range of gold, diamond, and platinum jewelry for men, women, and children, including traditional Indian designs as well as contemporary styles. The brand is known for its high-quality craftsmanship and use of the finest materials, and it has won several awards for its designs and customer service. In addition to jewellery, Kalyan Jewellers also offers gold coins, bars, and other gift items such as watches, perfumes, and accessories. The brand is committed to ethical and sustainable practices and sources its materials from trusted suppliers. Kalyan Jewellers has built a strong reputation for its quality products and customer service, and it remains a popular choice for consumers in India and beyond. The brand has also been associated with several high-profile celebrities and has launched several successful marketing campaigns to promote its products. Overall, Kalyan Jewellers is a trusted and reliable brand that has become a household name in India’s jewellery industry. |
| Reliance Jewels | 99 | 85 | Reliance Jewels is a jewellery brand that is part of Reliance Retail, one of India’s largest retail chains. The brand was launched in 2007 and offers a wide range of gold, diamond, and platinum jewellery for men, women, and children, as well as silver jewellery and fashion accessories. Reliance Jewels is known for its high-quality craftsmanship and use of the finest materials, and it offers a range of traditional and contemporary designs to suit different tastes and occasions. The brand is also committed to ethical and sustainable practices and sources its materials from trusted suppliers. Reliance Jewels has a strong presence in India, with over 80 showrooms across the country. The brand also offers a range of online services, including online shopping, virtual try-ons, and home delivery. Overall, Reliance Jewels is a trusted and reliable brand that offers a wide range of jewellery options for different budgets and occasions. The brand has built a strong reputation for its quality products and customer service, and it remains a popular choice for consumers in India. |
| Joyallukas | 85 | 67 | Joyalukkas is a jewellery brand that originated in Thrissur, Kerala, India in 1987. It has since grown to become one of the largest jewellery retailers in the world, with over 160 showrooms across 11 countries, including India, the Middle East, Singapore, and the UK. Joyalukkas offers a wide range of gold, diamond, and platinum jewellery for men, women, and children, as well as bridal jewellery sets and fashion accessories. The brand is known for its high-quality craftsmanship and use of the finest materials, and it offers a range of traditional and contemporary designs to suit different tastes and occasions. In addition to jewellery, Joyalukkas also offers gold coins, bars, and other gift items such as watches, perfumes, and accessories. The brand is committed to ethical and sustainable practices and sources its materials from trusted suppliers. Joyalukkas has won several awards for its designs and customer service, and it is widely regarded as a trusted and reliable brand by consumers. The company also has a strong commitment to social responsibility and supports several charitable initiatives in the areas of education, healthcare, and community development. Overall, Joyalukkas is a trusted and respected brand that has become a household name in India’s jewellery industry and beyond. |
| PC Jewellers | 82 | 68 | PC Jewellers is a prominent jewellery brand that was founded in Delhi, India in 2005. It offers a wide range of gold, diamond, and platinum jewellery for men, women, and children, including traditional Indian designs as well as contemporary styles. PC Jewellers is known for its high-quality craftsmanship and use of the finest materials, and it has won several awards for its designs and customer service. The brand is also committed to ethical and sustainable practices and sources its materials from trusted suppliers. In addition to jewellery, PC Jewellers also offers gold coins, bars, and other gift items such as watches, perfumes, and accessories. The brand has a strong presence in India, with over 100 showrooms across the country. PC Jewellers has faced some controversies and challenges in the past, including allegations of fraud and disputes with investors, but the brand has taken steps to address these issues and maintain its reputation for quality and reliability. |
| Shubh Jewellers | 82 | N/A* | Shubh Jewellers is a jewellery brand based in India that offers a range of gold, diamond, and silver jewellery, as well as gemstones and other accessories. The brand appears to have a strong focus on traditional Indian designs and craftsmanship, and it has several showrooms across India. |
| PC Chandra Jewellers | 57 | 50 | PC Chandra Jewellers is a prominent jewellery brand that was founded in Kolkata, India in 1939. It offers a wide range of gold, diamond, and platinum jewellery for men, women, and children, including traditional Indian designs as well as contemporary styles. PC Chandra Jewellers is known for its high-quality craftsmanship and use of the finest materials, and it has won several awards for its designs and customer service. The brand is also committed to ethical and sustainable practices and sources its materials from trusted suppliers. In addition to jewellery, PC Chandra Jewellers also offers gold coins, bars, and other gift items such as watches, perfumes, and accessories. The brand has a strong presence in India, with over 40 showrooms across the country. PC Chandra Jewellers has built a strong reputation for its quality products and customer service, and it remains a popular choice for consumers in India. The brand has also been associated with several high-profile celebrities and has launched several successful marketing campaigns to promote its products. Overall, PC Chandra Jeweler’s is a trusted and reliable brand that has become a household name in India’s jewelry industry. |
| Orra Jewellery | 58 | 25 | Orra Jewlery is a jewelry brand that was founded in Mumbai, India in 2004. It offers a wide range of gold, diamond, and platinum jewelry for men, women, and children, including traditional Indian designs as well as contemporary styles. Orra Jewlery is known for its high-quality craftsmanship and use of the finest materials, and it has won several awards for its designs and customer service. The brand is also committed to ethical and sustainable practices and sources its materials from trusted suppliers. In addition to jewellery, Orra Jewellery also offers gold coins, bars, and other gift items such as watches, perfumes, and accessories. The brand has a strong presence in India, with over 30 showrooms across the country. Orra Jewellery has a unique identity and has positioned itself as a brand that caters to modern, independent women who value quality and design. The brand has collaborated with several designers and artists to create exclusive collections and has also launched several successful marketing campaigns to promote its products. |
How much gold is held in India?
Gold has a special place in Indian culture and society, and is widely used for weddings, religious festivals, and as a store of value. The country has a long history of gold ownership and trading, and it is estimated that India accounts for around a quarter of the global demand for gold. The data given 744 metric tonnes gold is an official reserve i.e. under the custody of Reserve Bank of India not the Indian public and other agencies are having. Indian households may have accumulated up to 25,000 tonnes of gold, the international price (25 metric tonne) would be as much as (+) $1,135 billion, or equivalent of more than 40% of India’s nominal gross domestic product (GDP). thereby retaining the tag of the world’s largest holders of the metal, according to the London head quartered World Gold Council (WGC) estimate.
However, despite the country’s love affair with the precious metal, there is no official data on how much gold is held in India. It’s true Indian households hold more gold than the world can even imagine. Estimates vary widely, with some suggesting that there could be as much as 25,000 tonnes of gold within the country’s borders. But 25K tonne is a very conservative figure, modest estimate should be 33000-35000 Tn. In 2012 estimate based on past Reports of various international orgs was 22K. From 2012-2021 India must have added 8T very easily. This figure includes gold in the form of jewelry, coins, and bars. Should we take in account is the gold reserve from 5 most popular temples in India they are Tirupati Balaji temple, padmanabhaswamy temple, Vaishnavi devi mandir, Varanasi temple, shirdi saibaba mandir, the total gold reserves of all the temples are 24000 metric tonnes. So, between 50 000 and 60 000 metric tonnes gold held in India is a possible fact.
One reason for the lack of accurate data is the prevalence of unofficial imports, or smuggling. India imposes a high import duty on refined gold bars, currently set at 10%. This means that the price of gold in India can be significantly higher than the international gold price, creating an incentive for smugglers to bring gold into the country illegally. In india average middle-class family has 20 sovereign coins of gold at their homes
The Indian government also strictly controls the entities that are authorized to import gold into the country, and has imposed restrictions on gold imports in the past. For example, between 2013 and 2015, the government imposed severe impediments on gold import flows in an attempt to reduce the country’s trade deficit.
Despite these challenges, India remains a major player in the global gold market. The country’s vast and populous cities support multiple large and active gold trading centers, and are responsible for the majority of gold imports. Delhi, Ahmedabad, and Bangalore are the most important importation points, with Delhi being by far the most active.
In recent years, the Indian government has taken steps to reduce the country’s reliance on imported gold. One approach has been to promote domestic recycling, with the aim of reducing the need for non-domestic supply. However, given the strong cultural and economic factors driving gold demand in India, it is unlikely that the country will ever completely wean itself off its love of the precious metal.
Government Restrictions on Gold Imports – A Timeline
India is one of the world’s largest gold importers, and the Indian government has implemented several restrictions on gold imports over the years in an attempt to reduce the country’s trade deficit. In this article, we provide a timeline of the major government restrictions on gold imports.
- 1998: The Indian government allowed nominated agencies and nominated banks to import gold in a variety of ways, including receiving loans from suppliers, on a credit basis, on a consignment basis, and on an unfixed price basis.
- May 13, 2013: The Reserve Bank of India (RBI) restricted nominated banks from importing gold on a loan or an unfixed price basis. Banks could only import gold on a consignment basis.
- June 4, 2013: The RBI extended the consignment basis restriction to all nominated agencies, premier trading houses, and star trading houses.
- June 27, 2013: Authorized dealers of foreign exchange were prohibited from advancing credit to importers of gold, and all Letters of Credit had to be on a 100% cash margin basis. All gold imports had to be on a Documents against Payment (DP) basis.
- July 22, 2013: The RBI introduced the 80/20 rule, requiring that at least 20% of all gold imported into India be made available for export. The 20% of imported gold earmarked for export had to remain in bonded warehouses until it was exported.
- August 14, 2013: The RBI banned the import of gold coins and medallions. All gold imports had to arrive through customs bonded warehouses. Premier and star trading warehouses and entities based in special economic zones (SEZs) and export-oriented units (EOUs) could only import gold into India for the sole purpose of exporting it again. Gold doré bar imports required a license from the Directorate General of Foreign Trade (DGFT).
- May 21, 2014: Premier and star trading houses were allowed to participate in the 80/20 rule.
- November 28, 2014: The Indian government withdrew the 80/20 rule scheme.
- February 18, 2015: The RBI and Indian government allowed nominated banks to import gold on a consignment basis, but only against upfront payments. Premier and star trading houses could import gold on a Documents against Payment (DP) basis with no restrictions on end use. The ban on the importation of gold coins and medallions was lifted, but banks could still not sell gold coins and medallions.
India’s gold imports were high before the government implemented these restrictions, with an average of 735 tonnes of gold imported per year between 2001 and 2015. Gold imports were particularly high in 2010, 2011, and 2012, before the restrictions began to take effect. The restrictions led to a decrease in gold imports, with 828 tonnes imported in 2013, 779 tonnes in 2014, and over 900 tonnes in 2015.
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