After Prime Minister Narendra Modi’s appeal to the countrymen not to buy gold for a year, the hustle and bustle in the bullion markets of the capital has intensified. A decline in gold purchases has been recorded in many major markets of Delhi during the last two days. Traders are expressing concern about this. At the same time, a state of confusion is visible among the customers also.
In fact, emphasizing the need to save foreign exchange, Prime Minister Narendra Modi had appealed to people to avoid buying gold jewelery for a year. Its effect is now clearly visible in the markets. Many jewelery traders in Delhi say that customers planning to buy gold for weddings and family functions are currently waiting.
Many customers are believing that if the demand in the market decreases then the prices of gold may fall further in the coming time. There has already been a softening of about 25 percent: Traders say that there is little possibility of a major fall in gold prices. According to him, there was a huge rise in the prices of gold from Diwali to March last year, but after that the market has already softened by about 25 percent. Traders believe that at present the agricultural season also affects the market.
Farmers remain busy in farming from Holi to monsoon. The purchase of gold in rural areas increases only after the crop is sold. People are avoiding depositing money even in installment schemes. Many goldsmiths and jewelery sellers seem worried. He says that an atmosphere of fear has arisen among the customers and many people are avoiding depositing money even in gold installment schemes. Small traders are being affected the most due to increasing uncertainty in the market.
People associated with the bullion market say that if the same situation continues in the coming days, there can be a huge impact on the business. At present traders are waiting for the market to become normal. Many customers said that they will buy as much gold jewelery as required.
Why is gold so important for the economy?
According to Professor Sundaravalli, head of the India Gold Policy Center of the Indian Institute of Management, India imports about 600 to 700 tonnes of gold every year while exports are very less. A large amount of gold is stored in homes in the country and it is estimated that Indian families have about 25 to 27 thousand tonnes of gold.
Pro. According to Sundaravalli, India consumes about 700 to 800 tonnes of gold every year, but domestic production is only around one to two tonnes. In such a situation, the country imports the gold it needs, which puts great pressure on the foreign exchange. That means demand for dollar increases and rupee weakens.