Budget 2026 and Gold: What investors are hoping for

Gold price today

• Investors seek safer, efficient alternatives to physical gold in Budget 2026.
• Experts advocate policies to boost digital and paper gold for liquidity and safety.
• Reintroducing Sovereign Gold Bonds could boost returns and reduce storage risks

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With Budget 2026 around the corner, gold investors are seeking greater clarity, improved safety, and smarter alternatives to storing physical gold at home. Despite growing financial awareness, a significant share of Indian household savings continues to be parked in physical gold—often lying idle, difficult to monetise, and inefficient from a personal finance standpoint.

Market participants believe this presents a larger opportunity. Channelising household gold into digital and regulated financial products could not only improve returns for families but also align with India’s long-term development goals under the Viksit Bharat 2047 vision.

Rising Gold Prices, Shifting Buying Behaviour

With gold prices hovering near historic highs of around Rs 1.62 lakh per tola, Mahendra Luniya, Chairman, Vighnharata Gold, notes that investor behaviour is evolving.

“At current price levels, buying large quantities of jewellery is no longer easy for most retail investors. This has led households to gravitate towards smaller denominations such as one-gram coins or bars, or to simply hold gold as a long-term store of value,” he says.

He adds, “This trend underlines gold’s continued relevance in Indian portfolios, but it also exposes the need for safer, more efficient and financially meaningful investment avenues.”

Why Physical Gold Falls Short

From a portfolio management perspective, physical gold poses several challenges. Storage expenses, purity verification, insurance risks and low liquidity often make it an inefficient holding, especially as portfolio sizes expand.

“These limitations become increasingly visible as investors look for better oversight and flexibility in managing their wealth,” Luniya points out.

In contrast, digital gold and regulated paper gold instruments help address many of these pain points by offering improved liquidity, transparency and ease of access.

“Gold will always be integral to household wealth in India, but physical ownership is no longer the most practical option for modern investors,” says Luniya. “Budget 2026 should actively promote a transition towards regulated digital and paper gold products that offer safety, liquidity and alignment with long-term financial planning.”

Sovereign Gold Bonds: A Missing Link

The Sovereign Gold Bond (SGB) scheme played an important role in gradually reducing reliance on physical gold. By offering price-linked appreciation, annual interest, sovereign backing and tax benefits on maturity, SGBs positioned gold firmly as a financial asset.

Over the years, the scheme helped reshape investor perception of gold. However, according to Luniya, the absence of fresh issuances has left a gap.

“With new SGB issuances on hold, investors today have limited government-backed options for efficient gold exposure,” he says.

He further adds, “Bringing back SGBs would strongly favour retail investors. They allowed households to earn superior risk-adjusted returns from gold without worrying about storage or security. From a personal finance standpoint, SGBs remain among the most effective tools for gold allocation in a diversified portfolio.”

What Gold Investors Expect from Budget 2026

As the Union Budget approaches, industry voices expect measures that simplify gold investing while improving safety and transparency.

“Clearer rules for digital gold, renewed policy focus on financial gold products, and incentives that reduce excessive physical hoarding could help households deploy gold more productively,” Luniya suggests.

For Indian investors, gold will always carry emotional as well as financial significance. The expectation from Budget 2026 is that gold also evolves into a smarter personal finance asset, one that supports long-term wealth creation rather than remaining locked away in storage.