It seems that the people in the city do not care about the import duty hike and the appeal by the Finance Minister to control gold purchase. As the gold sales has reached off-season, the sales had recorded an increase of 20-30 per cent compared to a year earlier, sources said.
“The rush for gold in the past two months was such that people were not aware about the import duty hike. The gold price has witnessed a mild drop which was a catalyst for buying the yellow metal. People still consider gold as the best investment option,” said an official of a jewellery shop in the city.
In order to curb the widening current account, the government had increased the import duty of gold from 6 per cent to 8 per cent on June 5.
This was the second hike in six months. But to the surprise of many, the price of gold had fallen below Rs 20,000 mark for eight grams. “This proved to be an accelerator for the spurt in gold sales and people have made best use of the opportunity. The figures suggest that the sales have not been affected by the import duty hike,” said an official of Alapatt Jewellers.
According to the report by World Gold Council, the total demand of gold in India in January-March 2013 was 257 tonnes, up 27 per cent on the same quarter last year.
Retail investment was up 52 per cent while jewellery was up 15 per cent in the same period. In the past five years, gold prices have increased by 238 per cent.
But gold price has dropped by around 15 per cent so far this year, after more than a decade of gains. As per a rough estimate, Kochi accounts for about 14 per cent of the total gold consumed in the state. In 2011, 245 tonnes of gold worth Rs 75,000 crore was sold in the state.“Though gold sales have moved on to off-season the sales are witnessing even now. We expect good sales when season begins in August,” jewellers said.