China Gold Consumption Surpasses India For the First Time In 2013 – WGC

By @ibtimesau on

China has recently surpassed India as the world's top consumer of the safe haven yellow metal gold for the first time in 2013.

In a latest report released by the World Gold Council (WGC), India's gold consumption stood at only 974.8 tons compared with China's overall 1,065.8 tons.

By points basis, China's consumer demand for the yellow metal gold was up at 32 percent in 2013, compared with the 13 percent of India.

China managing to overshoot India in the gold consumption race did not happen by chance.

"It is not just an aberration. Going ahead, China's demand for gold is expected to exceed India's in the coming years," PR Somasundaram, WGC managing director (India), said.

For 2014, the WGC forecast China's demand for gold will hit from 1,000 tons to 1,100 tons while in India may be just 900 tons to 1,000 tons.

"China has put in infrastructure that was in favour of gold, India has turned away from it," Somasundaram P R, WGC managing director, India, told PTI.

Even as overseas gold prices slumped to its biggest annual drop since 1981, the weaker rupee coupled with stringent supply restrictions failed to rouse up India's weak gold demand.

"Indian consumers therefore missed the opportunity to buy gold at lower levels during the second half of the year unlike in many other markets," the report pointed out. This does not mean however that India will no longer crave for its gold fix.

"India's love affair with gold is a culmination of several factors and it will continue. This is also because apart from the jewellery demand, the investment demand continues to remain strong," Somasundaram said.

The WGC noted India's gold imports between July and October dropped 63 percent from a year ago when the government started implementing measures to limit gold imports.

"However, the Indian gold market is fed by a number of alternative sources, including recycled gold, domestic production and unofficial imports," the report said.

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