Publication Date: November 1, 2025
Published by MACKGOLD | OBSIDIAN CIRCLE
Strategic Division of Geopolitics and Natural Resources
mackgold.com
As Diwali approached, the gold markets of Delhi once again turned into a living mosaic of light, color, and commerce. In Lajpat Nagar, jewelers kept their doors open even on holidays, while streets filled with cars and garlands led to glowing shop fronts. Yet this year’s celebration carries a new tone: gold prices in India have climbed to their highest level in recorded history—₹101 078 per 10 grams (roughly $1 220–$1 230) in June 2025, and exceeding $4 000 per troy ounce on international markets during autumn peaks.
The surge has not destroyed India’s passion for gold—it has reshaped it. The same spiritual drive to acquire gold during auspicious days such as Dhanteras remains intact, but the economic logic behind the purchase has evolved.
A New Economy for an Ancient Affection
Although the yellow metal has risen nearly 60 percent in price this year (silver about 70 percent), Indians continue to buy—yet in different ways. In the words of Delhi jeweler Tanishq Gupta, “People aren’t saying ‘I won’t buy’; they’re saying ‘I’ll buy a little less.’”
Jewelers have had to innovate. Light, hollow designs now replace massive ornaments. Tiny commemorative coins weighing 250 milligrams—and even micro-coins of 25 milligrams—allow buyers to keep the ritual alive without exhausting their savings. The result is a subtle democratization of ownership: anyone can still “touch” gold, though perhaps with fewer grams in hand.
From Adornment to Investment
According to the World Gold Council (WGC), India’s consumption pattern has shifted decisively toward investment. In the second quarter of 2025, households purchased 88.8 tonnes of jewelry versus 106.6 tonnes a year earlier. At the same time, demand for bars and coins increased from 43.1 to 46.1 tonnes. That means jewelry’s share fell to 65.8 percent of the 134.9-tonne total, while investment forms rose to 34.2 percent—up from 71 to 29 percent the previous year.
This shift extends into the digital space. In September 2025, Indian gold exchange-traded funds (ETFs) registered net inflows of $902 million—equivalent to 7.3 tonnes—lifting total assets to $10 billion backed by 77.3 tonnes of physical gold. Year-to-date inflows reached $2.18 billion, far surpassing $1.28 billion for 2024 and $295 million for 2023. Middle-income earners and younger buyers, comfortable with mobile trading apps, now accumulate “invisible gold” in fractions as small as 0.1 to 1 gram through digital platforms.
The Central Bank’s Quiet Power
Behind the cultural scene lies a monetary one. The Reserve Bank of India (RBI) has been steadily expanding its gold holdings to hedge against dollar dependency and global volatility. Between July 2024 and July 2025, gold’s share of India’s foreign-exchange reserves rose from 8.9 percent to 12.1 percent. The RBI now holds roughly 880 tonnes of bullion, worth about $108.5 billion as of mid-October 2025. Analysts at Kotak Securities note that India has become one of the world’s key official purchasers of gold over the past three years, adding significant momentum to the global price rally.
The Uneven Glow
For India’s wealthier families, high prices have not dimmed the festive sparkle. For others, however, they have made the ritual painfully expensive. “I keep thinking whether I should buy anything at all,” says Bhavna, a Delhi bride planning her February wedding but waiting for prices to cool.
Economists at the Bank of Baroda estimate that although volumes may fall, the rupee value of India’s gold demand will remain stable thanks to record prices. In practical terms, a 10-gram purchase now costs ₹100 000–₹110 000, compared with ₹70 000 a year earlier.
A Cultural Constant and an Economic Anchor
Gold’s meaning in India transcends commodity logic. It is a hereditary asset, a dowry, a blessing, and a form of self-insurance. Morgan Stanley estimates that Indian households collectively hold gold worth $3.8 trillion—nearly 89 percent of the nation’s GDP—or about 34 600 tonnes of metal stored in homes and vaults. This immense private reserve forms a hidden pillar of economic stability. Rising prices therefore strengthen household balance sheets and, indirectly, domestic consumption.
Gold as a Mirror of Its Time
The 2025 Diwali season captures a paradox: continuity within change. The rituals remain; the medium evolves. Heavy necklaces give way to lightweight craftsmanship; cash counters yield to mobile apps; symbolic grams replace opulent kilos. On the national level, India’s policymakers see gold as strategic security. On the personal level, families view it as memory—wealth that can be held, passed on, and trusted when currencies falter.
Despite record highs, India’s attachment to gold endures. For millions, it is not mere ornamentation or speculation but a living metaphor for endurance itself—an enduring glint of permanence in a world of shifting prices and uncertain futures.
Published by MACKGOLD | OBSIDIAN CIRCLE
Strategic Division of Geopolitics and Natural Resources
mackgold.com