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Informist, Wednesday, Oct. 15, 2025

 

MUMBAI – With gold prices zooming to record high levels, consumers could be preferring lower-carat gold jewellery. However, this shift seems to be a slow process, experts said. India will take another 2–3 years to accept 9-carat gold jewellery, Saiyam Mehra, chief executive officer of Unique Chains and Jewels Ltd., said Wednesday. Bullion dealers and experts said customers need some education regarding such low-carat jewellery, which will lead to more traction in the segment. 

 

During CareEdge's webinar and panel discussion on gold and jewellery, Mehra said Indians have accepted 9-carat diamond jewellery, and they will accept gold jewellery the same way when there is a wide range of products available. "There is only a certain kind of jewellery now which is being manufactured in 9-carat, the entire value chain is not being manufactured in 9-carat," he said. 

 

The panellists during the session also said accepting low-carat jewellery is more of a "cultural issue". "People think that only 22-carat gold is pure or 18-carat is pure, 9-carat isn't pure....I think it's a lot of requirement to educate the customer," Sanay Banka, Senco Gold Ltd.'s chief financial officer, said.    

 

Banka said the shift towards 9-carat gold jewellery may happen even before 2–3 years, as pegged by Mehra. "In the next wedding season, people who have to buy the jewellery for certain budget... They will not increase the budget to 30-40% (of the entire budget for the wedding) so that option will be much faster," he explained. 

 

The government had on Jul. 18 approved hallmarking standards for 9-carat gold, making it officially part of the Bureau of Indian Standards' hallmarking system. During the presentation by CareEdge, analysts from the firm said that in Indian weddings, people generally allocate 25% of the total budget towards the purchase of jewellery.

 

"Despite being one of the largest gold consumers, India's per capita gold demand has stayed almost the same over the last decade at 0.6 grams per capita," Amit Jain, analyst at CareEdge Advisory, said. "This indicates strong potential for future demand as rising disposable income and increasing participation of young and working women are likely to support the future demand."

 

Over a period of 10 years, the volume of India's demand for gold jewellery has dipped 10% to 563 tonnes in 2024, from 627 tonnes in 2014. However, demand for gold bars and coins during the same period rose 16% to 239 tonnes, Jain said. "This shows that gold is being viewed more as a financial investment, rather than only as an economic (proposition). And this change reflects financial awareness, investment-oriented mindset, and increasing awareness of gold's role as a financial asset," he said.

 

Talking about income growth and gold prices, Amir Shaikh, assistant director at CareEdge Advisory, said gold prices between 2015 and 2025 rose at a compounded annual growth rate of nearly 11%, while per capita disposable income grew only 9%. "Despite income growth lagging behind increase in gold prices, gold jewellery demand declined only marginally by 1.9?GR," he said.

 

Citing the World Gold Council's study, Shaikh said a 1% rise in per capita income leads to a 0.9% increase in gold demand. However, higher prices can still limit buying, as every 1% increase in gold prices in the rupee term tends to reduce demand by around 0.4%, he added. "This indicates that demand responds more to income than price. That's a powerful indicator for gold's emotional and economic importance in Indian household," Shaikh said.  End

 

Reported by J. Navya Sruthi and Abhijit Doshi

Edited by Tanima Banerjee

 

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