Gold producing countries:
Gold is a very rare element. China, Russia, Australia, South Africa, New Zealand, Mexico,
Ghana, united states, etc are the major gold producing countries. Each year 3500 tonnes of gold is produced. Before 2006 south Africa was the world’s largest gold
producer. After 2006 china became the world’s largest gold producer.
Top 10 gold producing countries:
- China = 383.2 tonnes
- Russia = 329.5 tonnes
- Australia = 325.1 tonnes
- United states = 200.2 tonnes
- Canada = 182.9 tonnes
- Peru = 143.3 tonnes
- Ghana = 142.4 tonnes
- South Africa = 118.2 tonnes
- Mexico = 111.4 tonnes
- Brazil = 106.9 tonnes
Import of gold in India
As per the 2019 data, India imported gold worth $ 32.2 billion.
India mainly imports gold from Switzerland, the United Arab Emirates, Ghana, Peru, South Africa, united states, Bolivia, United Kingdom, Burkina Faso, Tanzania, Dominican Republic, Australia, Brazil, Colombia and Hong Kong.
Use of gold in Indian culture or society
In India, gold jewellery is inherent or essential to most religious
festivals and weddings. That is the main reason, in religious festivals
and wedding seasons, the demand for gold increases, it boosts the
price of gold. Indian women have an attraction towards the golden
ornaments. Mostly Indian people reserve gold in jewellery, which is
nearly 25,000 tonnes.
Indian investors look at gold as an investment purpose. As per
investors perception or views, gold price always increases, it will not
decrease. But actually, the price of gold Fluctuates it can be increased or decreased. It depends on the demand and supply of gold. Due to covid-19 situation, the price of gold is rose day by day. Because of the current situation, we are facing nation economy crashed, high unemployment rate, high inflation rate, the value of a stock decreases, etc. so the investors invested their funds in golds as security due to future uncertainty.
Gold reserve policy for the central bank
The Government of India keeps gold reserves. As per their its
policies, the Indian government can purchase or sale gold through the Reserve Bank of India (RBI). The gold reserves of the Indian government help to handle the nation’s uncertainty, foreign currency reserve, external debt, etc.
Reasons for the rise in the gold price
- Demand and supply
Since 2015 India reduced the import of gold from other
countries and the demand for gold is rising year by year. It
means the gold became valuable metal in India due to the high
demand and shortage of supply.
- High Inflation and devaluation of Indian currency
since 2012 is decreasing year by year. It has
affected other factors also like increase the value of all
goods and services (including metals like gold, silver, platinum).
The price index of India is rising year by year with the high
inflation rate. Currency value does matter in inflation factor.
Nowadays the US dollar is much stronger as compared to Indian
currency. It means the value of Indian rupees is cheap so
Indian consumer must pay a high amount of Indian currency for
buying goods and services (including gold, silver, platinum,
- Covid19 pandemic
This year the covid19 virus spread in more than 190 countries. Due to this pandemic situation, many countries put a restriction on travel, tourism and transport. So many countries are reduced their import and export of goods. The import of gold in India also decreased. Which affected the supply of gold and because of a shortage of supply of gold, price highly increased.
Written by: Vishal Vervalkar