China set to snatch the golden crown from India

30 Aug '05

2 min read

Where as the lure for the yellow metal does not seem to ebb, the World Gold Council announced Monday, India, the world's largest consumer of the gold, will witness increase in demand as incomes grow backed by festive purchases and a good food grain output.

It said that the demand, leaving behind recycled gold, went up 17.6 percent to 643 tons in 2004 from 547 tons last year. During the first quarter ending March this year, the demand zoomed 72 percent to 243 tons.

However, on the downside, the news is that China is said to pip India to the post of top gold consumer of jewelry in the coming years.

China recorded a 13.9 percent rise in gold and jewellery sales and picked up fourth position as gold digger in the world.

Booming economy has been cited as the reason for this unprecedented rise in demand, which saw domestic incomes soar by 9.5 percent, in urban areas during the first half this year, and is expected to grow by the decade end.

According to GFMS, a research organization, retail gold jewellery sales increased by over 11 percent to 224 tons last year.

In the next five years, sales may cross 600 tons mark relegating India in the second position as the largest gold consumer. Gold jewellery demand from India stood at 517.5 tons during 2004, research agency figures revealed.

Chinese gold producers hit the proverbial 'golden pot' last year high gold prices pushed output and profits. Mainland gold production touched a record high of 212.4 tons last year registering a 11.6 percent rise over 2003 figures, China Gold Association statistics said.

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