India's gold demand to grow to 1,200 tonnes by 2020, says study

Mumbai: Gold demand in India will continue to grow and is likely to reach 1,200 tonnes or approximately Rs250,000 crore by 2020, at current price levels, according to study released by the World Gold Council (WGC).

''The rise of India as an economic power will continue to have gold at its heart. India already occupies a unique position in the world gold market, and as private wealth in India surges over the next ten years, so will Indian demand for gold,'' WGC managing director, India and the Middle East, Ajay Mitra said in a statement here.

He added that the study confirms that India will remain a key driver of global gold demand.

'India: Heart of Gold' is the second in a series of WGC research with focus on India, which includes forecasts from the Centre for Monitoring the Indian Economy (CMIE).

Mitra said: ''Furthermore, gold will remain auspicious given its connection with tradition, whether religious or attitudinal, will remain powerful.''

He pointed out that Indians tend to be risk averse and place great faith in the wealth preservation qualities of gold, which inspires confidence, stability and security.

''Therefore, the view that Indian demand for gold will be driven by the concept of enduring value, not price,'' he said.