Gold Exchange: Rush to buy new gold by trading in old gold! Massive 60% surge in exchanges..

The continuously rising price of gold in the country has altered consumer buying habits. Instead of spending cash to purchase new gold, people now prefer exchanging their old ornaments for new jewelry. According to jewelry retailers, transactions involving the exchange of old gold for new jewelry have seen a year-on-year increase of approximately 60%. High gold prices, import duties, and economic uncertainty are rapidly fueling this trend.

According to an ET report, Joy Alukkas, Chairman of the leading jewelry retail chain Joyalukkas, stated that the share of the gold exchange program in the company's total sales has now reached 65%, up from the previous 40–45% range. He noted that on certain days, the exchange of old gold accounts for up to 70% of the company's business. Meanwhile, Ramesh Kalyanaraman, Executive Director of Kalyan Jewellers, said that the share of exchange-based sales at his company has risen from 30% to 40–45%. The company has also launched special gold exchange campaigns following the Prime Minister's appeal.

**Impact of Import Duty and High Gold Prices**
Industry insiders say this trend has strengthened following the government's hike in the effective import duty on gold and the sharp surge in gold prices. On Thursday, the price of 24-carat gold reached approximately ₹1.56 lakh per 10 grams, compared to around ₹1 lakh per 10 grams a year ago. In this environment, purchasing new jewelry by utilizing the value of old ornaments has become a more convenient and cost-effective option for customers.

**Gold Held in Households Becomes a Market Force**
India is among the world's largest consumers of gold. It is estimated that Indian households hold approximately 25,000 tonnes of gold. Surendra Mehta, National Secretary of the India Bullion and Jewellers Association (IBJA), states that gold exchange programs are helping bring gold held in households back into the market. This could reduce dependence on new gold imports. India imports approximately 900 to 1,000 tonnes of gold annually; consequently, reusing old gold could prove beneficial for the country.

Tanishq, one of the country's largest jewelry brands, is also promoting gold exchange. According to Ajoy Chawla, CEO of Titan’s Jewellery Division, around 4.4 lakh customers have exchanged 10 tonnes of gold over the past eight months. Market experts believe that if gold prices remain high, the trend of gold exchange could accelerate further in the coming months. This shift could transform the jewelry business model, with the recycling of old gold playing a major role alongside—or even instead of—new purchases.

Disclaimer: This content has been sourced and edited from TV9. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.