National News
India gold market update: Record high prices, accompanied by investment interest
Price surge dims jewellery demand, while investment interest lingers, Gold ETFs see unprecedented inflows in January
Gold achieves a new peak
Heading into 2025, gold has not only reversed the price moderation seen in November-December (a decline of 6%), but it has also repeatedly hit new -record highs. So far in 2025,1 the LBMA gold price AM in USD has surged by US$286/oz or 10% to US$2,938/oz. Domestic prices have been rising in parallel with international prices, rising by 14% to a record INR86,831/10g,2 with the higher gains attributed to the weakness in the INR against the USD (1.1% depreciation y-t-d). Our analysis indicates that the upward climb in gold prices can be attributed to a combination of geopolitical risks, growing concerns about inflation, and increased investment flows.
Union Budget 2025-26: key highlights pertaining to gold
One of the key takeaways from the Union budget presented on 1 February for gold is that the import duty hasn’t been changed. In the run-up to the budget there were worries that the government might hike the duty due to the rise in gold imports after it reduced the duty by 9% back in July 2024
On the other hand, the government cut the customs tariff on gold jewellery from 25% to 20%. This is likely done as part of the overall rationalisation of tariffs across commodities. However, since jewellery imports aren’t that significant and are limited to high-end jewellery (and of low caratage), this cut in duty is unlikely to have much impact on domestic jewellery production
It was also announced that new tariff lines will be introduced under the HSN codes3 for precious metal from 1 May to distinguish imports of precious metals in various forms. The new tariff lines will differentiate gold imports in bar form from other types. This is done to address the disruptions caused by imports of gold in forms such as platinum alloy and gold paste. From May, the tariff rates can differ based on the new classification
The government has also decided not to issue any sovereign gold bonds as part of its market borrowing programme. This could work in favour of gold ETFs, as investors looking for gold-related financial products may turn to ETFs instead.
Price surge takes shine out of jewellery demand, maintains investment interest
The rally in gold prices to repeated new all-time highs since the start of the year has weighed heavily on the retail demand for gold jewellery. Uncertainty about announcements in the Union Budget also influenced buying activity.
Anecdotal reports indicate that demand dropped sharply in January and the weakness persisted into February, despite the end of the inauspicious period in the Hindu calendar (15 Dec – 15 Jan) and the usual-post Union Budget pick-up in demand. Wedding-related purchases too have been subdued, suggesting that many consumers had front loaded their purchases when prices dipped in November. Rather than making fresh purchases, many buyers are opting to exchange old gold for new jewellery. Additionally, as gold prices surged past previous thresholds, many consumers are also taking the opportunity to sell old gold and lock in profits.
This slowdown in jewellery demand has left retailers reluctant to restock, as they face challenges in meeting payment terms with manufacturers. This has created a liquidity crunch within the industry. The subdued demand environment was reflected in the widening spread between domestic and international prices. Since December, domestic gold prices3 have been trading at a discount to international prices, with the gap widening from an average US$3/oz in December to US$23/oz.4
Notwithstanding the depressed jewellery demand, investment demand interest (for bars and coins) has stayed the course with investors anticipating further price increases.
Record inflows into gold ETFs
2025 began with strong interest in Indian gold ETFs, marked by unprecedented inflows in January. According to the Association of Mutual Funds in India (AMFI), gold ETFs recorded net inflows of INR37.5bn(~US$435mn) in January, significantly higher than the average inflows of INR9.4bn(~US$112mn) over the previous 12 months. The cumulative assets under management (AUM) of gold ETFs grew to INR51.8bn(~US$6bn), an 15% m/m increase and 4.6t were added to the overall holdings, taking the collective holdings to 62.4t. These figures are close to our initial estimates, which were based on information available at the time.5
Anecdotal reports suggest that the strong inflows in January can be attributed to investors redirecting free cash flow towards gold ETFs for diversification amid ongoing global and domestic economic and policy uncertainty. The sustained weakness in the domestic equity markets has also been driving flows into gold ETFs, with investors pulling back from equities in favour of the safe-haven appeal of gold.
In February, a new product was launched, bringing the total number of gold ETFs in India to 19,6 highlighting the strong momentum in this space.
Gold buying resumes at the RBI after a brief pause
The RBI resumed its gold purchases in January, after pausing in December following 11 consecutive months of buying. The central bank added 2.8t of gold to its gold holding during the month, taking its total gold reserves to a new high of 879t. This renewed buying suggests that the RBI is likely to continue with its gold accumulation, following a significant purchase of 72.6t in 2024, making it the third largest buyer of gold among global central banks that year.
Not only is the RBI building its gold reserves, the share of gold in its forex reserves has been steadily climbing from 7.7% in January 2024 to 11.31% by early February 2025.7 This increase reflects the RBI’s efforts to diversify its forex reserves, alongside a decline in its holding of foreign currency assets (from 88.5% to 85.2%).
Gold imports slow in January
Gold imports in January saw a noteworthy drop owing to high prices leading the pull-back in demand. Anecdotal market reports suggest that manufacturers did not pick-up imports, reflecting the depressed demand environment. January’s imports were the lowest since July 2024. According to Ministry of Commerce data, the gold import bill for the month totalled $2.68bn, a 43% decrease compared to December. However, it was approximately 40% higher than January of the previous year. We estimate that the volume of imports in January ranged between 30t-35t.
National News
Kerala Chief Minister’s Presence Marks Grand Finale Of KJIF 2026 As State’s Jewellery Industry Charts New Growth Vision
Three-Day B2B Fair Concludes With Record Participation, Strong Business Momentum and Unprecedented Government Support.
The fifth edition of the Kerala Jewellery International Fair (KJIF) 2026 concluded on an exceptional note, reinforcing Kerala’s position as one of India’s most influential jewellery markets. Organised jointly by the Kerala Gold & Silver Merchants Association (KGSMA) and United Exhibitions, the three-day B2B exhibition witnessed remarkable business activity, record industry participation, knowledge-sharing initiatives and an unprecedented level of government engagement.
The grand finale of the exhibition was marked by the Kerala Jewellers State Convention, where Hon’ble Chief Minister of Kerala, Shri V. D. Satheesan, addressed an audience of more than 5,000 jewellers, manufacturers, retailers, industry leaders and stakeholders from across the state. His presence elevated the stature of the convention and reaffirmed the Government’s recognition of Kerala’s jewellery sector as a vital contributor to the state’s economic development.
In his keynote address, the Chief Minister acknowledged Kerala’s longstanding leadership in the gold and diamond industry, describing the sector as a major driver of employment, entrepreneurship, exports and wealth creation. He highlighted the industry’s resilience, craftsmanship and global reputation while encouraging greater adoption of technology, innovation, responsible business practices and international competitiveness. Expressing confidence in Kerala’s jewellery fraternity, he called upon the industry to continue playing a transformative role in shaping the state’s economic future.
The State Convention also provided an important platform for meaningful interaction between policymakers and industry leaders, facilitating discussions on the future of the jewellery trade, sustainable growth, evolving consumer expectations and policy support required to strengthen one of Kerala’s most vibrant business sectors.
Distinguished Dignitaries Throughout the Three-Day Event
KJIF 2026 witnessed the participation of several eminent dignitaries throughout the exhibition, reflecting the growing importance of the jewellery industry within Kerala’s economic landscape.
The exhibition was formally inaugurated by Shri P. C. Vishnunadh, Hon’ble Minister for Tourism and Culture, while the official unveiling of KJIF 2026 was performed by Shri P. K. Kunhalikutty, Hon’ble Minister for Industries, IT & AI, who appreciated the exhibition’s contribution towards promoting business, manufacturing excellence and industrial growth.
The inaugural evening concluded with the spectacular KJIF Fashion Nite & Gala Dinner, graced by Shri Roji M. John, Hon’ble Minister for Higher Education, who interacted with industry members and appreciated the creativity and craftsmanship displayed by exhibitors.
On the second day, Smt. Shanimol Usman, Hon’ble Deputy Speaker of the Kerala Legislative Assembly, visited the exhibition and commended the industry’s continuous contribution towards employment generation and entrepreneurship.
Day 2 concluded successfully with the presence of Shri Ramesh Chennithala, Hon’ble Minister of Home Affairs and Vigilance, who shared his memories of interacting with Malayalee karigars across other states and stressed the importance of bringing that employment and craftsmanship back to Kerala while developing the state into India’s jewellery export hub.
The exhibition concluded with the Kerala Jewellers State Convention, where Hon’ble Chief Minister Shri V. D. Satheesan delivered the valedictory address, making the closing ceremony one of the most memorable moments in the history of KJIF.
Alongside the Chief Minister, Shri Benny Behnan, Hon’ble Member of Parliament, Shri Roji M. John, Hon’ble Minister for Higher Education, KGSMA State President Shri K. Surendran, State General Secretary Adv. S. Abdul Nazar, State Treasurer Shri C. V. Krishna Das, Shri V. K. Manoj, Project Director of United Exhibitions, Shri Varghese Alukka, Managing Director of Jos Alukkas Jewellery, along with the Vice Presidents and Secretaries of KGSMA, were present on the dais.
Outstanding Business Response
KJIF 2026 recorded an overwhelming response from jewellery retailers and trade buyers from every district of Kerala. The exhibition witnessed a strong influx of quality business visitors, resulting in productive interactions between exhibitors and buyers.
Exhibitors expressed high levels of satisfaction with the quality of footfall, reporting encouraging order enquiries, advance festive bookings and significant business generated across gold, diamond, bridal and contemporary jewellery collections. The exhibition once again established itself as Kerala’s most preferred sourcing platform ahead of the festive and wedding seasons.
Knowledge-Driven Industry Engagement
Beyond business, KJIF 2026 continued its commitment to industry development through a series of well-attended knowledge sessions.
The Banking Seminar brought together leading financial institutions and jewellery entrepreneurs to discuss banking solutions, working capital support, digital banking and financial best practices.
The seminar titled “Jewellery Business for Today & Future” featured eminent industry experts who shared valuable insights into changing consumer behaviour, organised retail, digital transformation, branding strategies and emerging opportunities within the jewellery sector.
The Youth Wing Seminar focused on preparing the next generation of jewellery entrepreneurs through discussions on leadership, succession planning, innovation and business sustainability, inspiring young professionals to take the industry forward.
Fashion Walk Adds Glamour to Opening Day
Adding elegance and excitement to the inaugural evening was the Fashion Walk Powered by Malayala Manorama, which presented exquisite jewellery collections through a professionally curated runway showcase. The event beautifully blended craftsmanship with contemporary design, providing participating exhibitors an exclusive platform to unveil their latest collections before Kerala’s leading retailers and industry professionals.
KJIF Strengthens Its Position as South India’s Premier B2B Jewellery Exhibition
The overwhelming response from exhibitors, visitors, trade associations and business partners reaffirmed the Kerala Jewellery International Fair as one of South India’s most influential B2B jewellery exhibitions.
By successfully integrating business networking, government participation, knowledge exchange and premium lifestyle experiences under one platform, KJIF 2026 once again demonstrated its commitment to strengthening Kerala’s jewellery ecosystem and creating new opportunities for manufacturers, wholesalers and retailers alike.
With record participation, strong business outcomes, impactful industry discussions and the distinguished presence of the Hon’ble Chief Minister of Kerala, KJIF 2026 concluded on a historic note, setting new benchmarks for the jewellery industry and paving the way for an even stronger, more innovative and globally competitive future for Kerala’s gold and diamond sector.
The next edition of the Kerala Jewellery International Fair (KJIF) will be held from 2nd to 4th July 2027.
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Kerala Chief Minister’s Presence Marks Grand Finale Of KJIF 2026 As State’s Jewellery Industry Charts New Growth Vision
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National News2 hours agoSay It with Candere: Jewellery Picks Inspired By Smriti Mandhana’s Effortless Style For Every Celebration and Everyday Moment
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BrandBuzz3 hours agoJos Alukkas Announces ‘Season Of Diamonds’ Campaign
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National News2 hours agoKerala Chief Minister’s Presence Marks Grand Finale Of KJIF 2026 As State’s Jewellery Industry Charts New Growth Vision
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