According to an SBI Research analysis released on Wednesday, total consumer demand for gold in India grew to 802.8 tones in 2024, accounting for 26% of world demand and placing India second only to China, which had consumer demand of 815.4 tones.

Key Highlights

• India’s consumer gold demand rose to 802.8 tonnes in 2024, making it the world’s #2 behind China.
• Reserve Bank of India’s gold reserves climbed to approximately 880 tonnes by September 2025.

Domestic gold supply is barely a portion of total gold supply in India, with imports accounting for approximately 86% of total supply in 2024 (according to World Gold Council estimates). Gold imports climbed by around 31 percent in FY24 and 27 percent in FY25.

However, increased prices have resulted in decreasing demand for gold in 2025. Consumer demand for gold fell by over 16% year on year in Q3 2025, because to lower jewellery demand, according to a report by Dr. Soumya Kanti Ghosh, Group Chief Economic Advisor at SBI.

Higher prices lowered gold imports by 9% to $26.5 billion in April-September FY26, down from $29 billion in the same period in FY25.

"Another notable trend is that central banks are increasing their gold reserves." Dr Ghosh stated that the RBI's gold holdings increased to 880 tonnes by 2025 as part of strategic reserve management.

Over a 5, 10, and 15-year period, gold returns have been equivalent to the equity market (Sensex); but, they substantially outperform the market return over a one- and three-year period.

"Furthermore, the recent discoveries of new gold mines in various districts of Odisha as Deogarh, Keonjhar, Mayurbhanj (with an estimated 1,685 kg of gold ore detected by the GSI), among others, Jabalpur in Madhya Pradesh (estimated quantity could run into lakhs of tonnes) and Kurnool district in Andhra Pradesh (India's first large private gold mine expected to produce 750 kg of gold annually) could help ease the pressure on imports and are positive for our current account", the report stated.

Also Read: RBI's Gold Reserves Surpass 880 Tones Amid Rising Global Demad

The government began issuing Sovereign Gold Bonds (SGBs) in November 2015 and has continued to do so in 67 tranches, the last of which was issued in February 2024.

As of October 23, the outstanding SGBs totaled 125.3 tonnes. Taking into consideration the announced redemption price of Rs 12,704 for 2017-18 Series IV, the total expenditure to the government would be Rs 1.59 lakh crore.

"The issue of these units totaled Rs 65,885 crore. Thus, the government has suffered a loss of Rs 93,284 crore as a result of the increase in gold prices," according to the report.