Demand for gold in rural India may be lower this year with weak Monsoon affecting household savings, says the World Gold Council (WGC).
It, however, states that the demand for yellow metal during Diwali festival is expected to be better.
According to Somasundaram, WGC India Managing Director, "About 7-8 per cent of rural household savings goes into gold buying in India. However, rural demand is not looking absolutely great now because rural household savings are coming down even though it is being expected that monsoon will be back to normal."
The yellow metal is the second largest import item for India after petroleum. In a move to reduce current account deficit, the government has imposed curbs on gold imports. The curbs comprise of raising the import duty on gold to 10 per cent and making it compulsory for traders to export 20 percent of the imported metal.
Emphasising on the quality of gold jewellery, Bureau of Indian Standards (BIS) Director General Sunil Soni said there has been an healthy growth of 25 per cent in hallmarked jewellery in the past one year.