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Last Updated : Feb 03, 2017 04:11 PM IST | Source: Moneycontrol.com

Gold loses sheen in 2016, demand falls 21% in India: WGC

"The industry faced a number of challenges in transitioning to the emerging, structurally transparent system-be it the PAN card requirement, the excise on jewellery, demonetisation or the publicity around income disclosure schemes," said Somasundaram PR, Managing Director, India, World Gold Council.


Moneycontrol Bureau 


Gold demand in India declined 21 percent year-on-year to 675.5 tonnes with industry facing a slew of challenges in transitioning to the transparent system, reveals a World Gold Council report.

"The industry faced a number of challenges in transitioning to the emerging, structurally transparent system-be it the PAN card requirement, the excise on jewellery, demonetisation or the publicity around income disclosure schemes," said Somasundaram PR, Managing Director, India, World Gold Council.

"This was not unique to gold, but trade practices and embedded buying behaviour created short-term headwinds."


Going forward, Somasundaram said the government policies will aim to deliver a stronger economy and a more transparent gold industry both of which should deliver significant benefits to gold buyers as well as accelerating the transformation of the industry in becoming more organised.


"Gold remains a legitimate savings option for million and in order for it to play a dynamic role in the economy, it has to enter the mainstream via organized channels," he added.

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The India head anticipates that 2017 will see a gold demand in the range of 650-750 tonnes due to introduction of Goods and Service Tax or GST coupled with the gradual adaptation to the previous year's policy changes. 


GLOBAL DEMAND


Global gold demand rose merely 2 percent in 2016 and touched 4,309 tonnes. However, this was the highest level since 2013, reveals a World Gold Council study.


The utterly rise in demand was largely driven by inflows in to gold-backed Exchange Traded Funds or ETFs.

According to the World Gold Council's latest Gold Demand Trends report, continued global economic and political uncertainty, most notably Brexit, the US election and currency weakness in China, helped to boost investment demand by 70 percent, to a four-year high of a 1,561 tonnes.  



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First Published on Feb 3, 2017 03:42 pm
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