With 32 of the state's 36 districts staring at drought due to less rainfall this year, farmers, working class people and consumers in general from the drought hit areas prefer to invest in Mutual Funds and special investment plan than investing in gold. Jewellers estimate 25 to 30 per cent reduction in gold purchase on the occasion of Dusshera especisally in the drought hit 200 plus talukas of Maharashtra. The rush to invest in new generation mobiles, cars and two wheelers, second home and travelling in various tourist attraction has also seen a dip.
The Maharashtra Jewellers Board, which is a representative body of 50,000 jewellers associations, said that the gold business was down during Ganesh festival; Navaratri was no exception. But the Board President Anil Waghadkar hoped that the gold purchase may pick up in Diwali.
"The present situation arose due to drought and economic slow down. Consumers are not ready to invest in gold. Gold business has gone down by about 25 to 30 per cent. Rise in gold prices is another factor for fall in gold purchase, he told DNA. He informed that slide in rupee and 3 per cent GST on gold are also other leading factors for cut in gold purchase.
Leading jeweller from north Maharashtra, who did not want to be identified, said investment in SIP and MF in Jalgaon city alone in September alone was a record Rs 32 crore. This is expected to increase further. "Consumers see it as secured investment with short and long term gains compared to gold. Farmers and middle class are attracted to investment in such instruments which is quite a unique trend," he informed.
Another jeweller from Jalna said the demonetization effects are still visible especially in people associated with small and medium industries. "Promoters of industrial units and workers used to invest a small amount in gold purchase, this year they are missing. Liquidity is main issue and therefore they are investing in Mutual Funds and special investment plan from their savings. The government needs to intervene and reduce GST which will help consumers in general," he added.
Keeping Hopes High
Maharashtra Jewellers Board said that the gold business was down during Ganesh festival; Navaratri was no exception. However, board president Anil Waghadkar hoped that business may pick up during Diwali
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