Gold suppliers imported large volumes of gold to India in November 2014 in anticipation of the government's adoption of new stringent restrictions on the import of precious metals. But the government decided otherwise and, instead of tightening restrictions, decided to cancel the 80:20 scheme, which was designed to reduce the import of gold into the country. In turn, this measure led to a glut of the Indian gold market. Import of gold soared in value terms to $ 5.61 billion in November, which led to a record 18-month growth in the trade deficit.
However, now many Indian families have accumulated gold reserves in jewelry and other forms to prepare for the upcoming wedding season, which will begin in mid-January. This trend could lead to a reduction in imports of gold to India by 73% from 151 tons of precious metal in November 2014 to 40 tons in January 2015.
"About 30-40% of the demand for wedding jewelry falls on the gold that is in the hands of many Indian families." New jewelry continues to be sold, but much more slowly, "said Ketan Shroff, spokesman for the Indian Association gold and jewelers (Bullion & Jewelery Association).
According to various estimates, up to 22 thousand tons of gold in various forms is in the hands of the population of India.