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 India’s gold demand fell 3% in 2023 to 747.5 tonnes, which is the lowest since 2020, as soaring prices reduced the demand for jewellery, according to a World Gold Council report released on Wednesday.

Indian gold consumption in the October-December quarter fell 4% to 266.2 tons, as a drop in jewellery demand eclipsed higher sales of coins and bars for investment purposes, the WGC said.

The January-March quarter, demand is expected to stay low due to fewer auspicious wedding days, the WGC said.

The Government has also imposed high Customs duty on gold to restrict imports as it leads to an outgo of precious foreign exchange which is required for essential imports such as crude oil.

Switzerland and the United Arab Emirates are the leading gold suppliers to India.

The report also states that the global jewellery market proved to be remarkably resilient amidst record-high prices as demand inched up by 3 tonnes year-on-year. China played an important role, recording a 17% increase in demand for gold, offsetting a 9% decrease in India.

Mine production of gold was relatively flat in 2023, up 1%. Recycling increased by 9%, which was lower than expected given the high gold price and drove total supply up 3%, the report added.