Ahmedabad’s gold import zooms 2.75 times

Gold has long charmed Indians in general and Gujaratis in particular, as jewellery and as an asset class. However, with gold prices soaring in the first half of the year 2010, one had thought that this fascination for gold would come down. But any such prognosis has been belied.

Despite there being no festivals other than Akshay Tritiya between January-June 2010, and high prices of the yellow metal, gold import in Ahmedabad has shot up to 2.75 times compared to the corresponding period last year.

According to the figures given by GSEC Ltd, which  handles air cargo in Ahmedabad, about 108 tonnes of gold were imported during the first half of the current year, compared to about 39 tonnes in the same period last year. This is an increase of about 175%. Apparently, people in Gujarat still see the precious metal as a good investment avenue.

This kind of quantum jump has been achieved even as the yellow metal witnessed all-time high price of around Rs19,500 per 10 gram during the last six months. Traders, analysts and experts explain this phenomenon by saying that gold purchases were low in the first half of 2009 due to economic slowdown.

“Gold buying has bounced back. Between January-June in 2010, gold was traded between Rs16,500 and Rs19,500 per 10 gram. Investors were waiting for right time to buy or invest in gold, as it is giving higher returns than equities and bank deposits at present,” said a city-based bullion trader and analyst, Girish Choksi.

Mumbai-based bullion analyst, Bhargav Vaidya, is a little surprised at such a huge rise in demand for gold. But he is quick to explain,  “In this period there was a time when international gold prices fell below $1,200 an ounce. As such, gold prices fell in the Indian market too. So, there was a sudden rise in demand for gold in the country. Simultaneously, now Ahmedabad air cargo also caters to the gold demand of Maharashtra due to heavy octroi and  local taxes in the latter.” 

GSEC Ltd is also surprised at the rise in gold demand. “Usually, gold import is maximum in second half of the year, which coincides with many festivals and marriage season. But in the first half this year, gold import was almost 1.75 times higher despite price rise and there being no festivals,” said the director of GSEC Ltd, Samir Mankad.

Besides, special jewellery designing is also attracting customers to Gujarat from across the nation.