MUMBAI: Gold imports by India are said to have jumped almost seven-fold in March from a year earlier as jewelers stocked up anticipating a demand recovery during the wedding season that began this month and the auspicious Hindu gold-buying day of Akshaya Tritiya.
Shipments advanced 582.5 percent to 120.8 metric tons last month from a year earlier, according to a person familiar with provisional data from the finance ministry, who asked not to be identified as the data aren’t public. Imports dropped 20 percent to 716.4 tons in the year ended March 31. Finance Ministry spokesman D. S. Malik declined to comment on the data.
Consumption in India, the world’s second-biggest gold buyer, has been recovering after a falling to the lowest level in seven years in 2016. A strike in March last year after a levy was introduced on jewelry produced and sold in India reduced consumption that was further dented by the government’s decision to withdraw high-denomination currency notes. March usually sees a spurt in gold imports due to warehouse clearance and re-stocking, the person said.
“Imports were down till January due to demonetization, so now people are re-stocking,” Mehul Choksi, chairman of jewelry store chain Gitanjali Gems Ltd., said by phone from Mumbai.
Trade data in India has been encouraging so far and suggests that the challenges to purchases due to demonetization are probably fading faster than initially anticipated, UBS AG said in a report on April 5. Purchases are expected to pick up heading into the Akshaya Tritiya festival that falls toward the end of April this year, while import data for the next couple of months will be a good gauge of underlying demand, according to the report.
Indians buy gold during festivals and for marriages as part of the bridal trousseau or as gifts, and the nation imports almost all the gold it consumes.