Mumbai, Feb 14 (PTI): The country's gold demand dipped by 12 per cent in 2012 to 864.2 tonne, mainly on account of higher import duties, jewellers strike over proposed measures to curb imports and a sharp rise in the domestic price, World Gold Council said in its report.
The overall demand of gold in the country had stood at 986.3 tonne in 2011, according to the WGC Gold Demand Trend 2012 report released on Thursday.
”China and India remain the world's gold power houses. In India, consumer sentiment towards gold remained strong despite measures aimed at curbing demand, reaffirming gold's role in Indian society.
In an underdeveloped financial system like India, gold has an important role to play,” WGC Managing Director, Investment, Marcus Grubb, said.
In 2013, WGC expects the demand to be in the 865-965 tonne range, an 11 per cent increase at the upper end, depending on any further government measures, he said.
India is likely to remain the biggest market for gold this year followed by China, he said.
In the first half of 2012, consumers faced headwinds in the form of higher import duties, market turmoil over proposed measures to curb imports and a sharp rise in the local price.
However, the demand staged a strong revival in the second half of the year as the market thrived during the fourth quarter wedding season and festive period.
Total jewellery demand in the country in 2012 was down by 11 per cent to 552 tonne, compared to 618.3 tonne in 2011.
However, the demand in terms of jewellery value rose by 8 per cent to Rs 1,l58,090 crore, compared to Rs 1,46,067.8 crore in 2011.
Total investment demand was down by 15 per cent to 312.2 tonnes, against 368 tonnes in 2011.
In value terms, gold investment demand went up by a marginal 3 per cent to Rs 89,412 crore compared to Rs 86,936.7 crore in 2011.
”Despite the turbulent macroeconomic climate throughout the year, as well as the regional uncertainties affecting India and China, the two largest gold markets, annual demand was 30 per cent higher than the average for the past decade,” Grubb added.