India’s Gold Import Bill Hits $58 Billion in FY25 Despite Soaring Prices

Despite record-high gold prices through 2024-25, India’s appetite for the precious metal remained largely undeterred. According to the Department of Commerce, gold imports by value soared by 27.38% year-on-year, reaching $58.01 billion in FY25 — a sharp jump of $12.47 billion over the previous year.

Slight Drop in Volume, but Not in Demand

In contrast, the volume of gold imports dropped by just 4.79%, falling from 795.32 tonnes in FY24 to 757.15 tonnes in FY25. This slight dip in tonnage suggests that while consumers may have purchased slightly less physical gold, their overall spending on gold continued to climb amid rising prices.

“Despite record-high prices of gold in 2024-25, Indian households’ purchase of the yellow metal hasn’t been seriously depressed.”

Gold Prices Skyrocket, Yet Consumption Remains Resilient

Over FY25, gold prices in India surged 33.78%, driven by factors such as inflationary pressure, geopolitical tensions, and investment shifts from equities to safer assets like gold.

The World Gold Council noted that global jewellery demand fell by 11% year-on-year due to persistent high prices. However, India’s jewellery demand contracted only 2%, showing remarkable stability compared to China’s steep 24% drop.

“The weakness was global, although India’s 2% year-on-year decline showed resilience, particularly compared with China’s 24% year-on-year drop.”

Festive and Policy Boosts in Gold Demand

Two Major Spikes in Gold Demand During FY25

India experienced notable surges in gold demand in August and November 2024.

“The August spike came after the first full budget of Prime Minister Narendra Modi government’s third term in July cut import duties on the yellow metal to 6% from 15%.”

This significant policy move made gold relatively cheaper, spurring imports. The second spike occurred in November, coinciding with the festive season, when gold purchases traditionally peak in India.

Global Uncertainty Drives Investment in Gold

Gold's upward trajectory began in October 2022, but its rise became steeper post-November 2024, coinciding with Donald Trump’s re-election as US President. His return sparked financial uncertainty, especially after renewed tariff threats, prompting a shift toward safe-haven assets.

“As tariff threats by Trump sparks sell-off in global financial markets, the investors are rushing to gold.”

Jewellery Exports Dip Amid Rising Prices

While domestic demand stayed largely intact, exports of gold jewellery declined, contributing to the slight dip in overall import volumes. High international prices likely dampened global retail interest, reducing India’s jewellery exports.

Conclusion: Gold Shines Brighter Despite Economic Headwinds

India's gold import trajectory in FY25 underscores the enduring cultural and economic importance of the yellow metal in Indian households. Despite a steep 33.78% rise in gold prices, the country imported gold worth $58.01 billion, marking a sharp $12.47 billion increase over the previous year.

Although import volumes dipped by 4.79%, the surge in value reveals robust demand supported by a strategic duty cut from 15% to 6% and traditional festive buying.

The August and November 2024 spikes clearly reflect consumer response to policy changes and seasonal celebrations. While global jewellery demand saw a significant downturn, India displayed relative resilience with just a 2% decline, highlighting its unique position in the global gold market. Additionally, geopolitical developments like the return of Donald Trump as US President and associated tariff concerns further fueled gold’s appeal as a safe-haven asset. India’s gold story in FY25 shines bright despite global economic uncertainties.