Modi Reiterates Appeal Against Buying Gold Amid Rising Global Uncertainty
Prime Minister Narendra Modi has once again appealed to Indians to refrain from buying gold, this time through an Instagram post. In the video, he emphasized the importance of self-reliance and stated that India will present a developed country to its young generation when it completes 100 years of independence.
This is not the first time Modi has made this appeal; in May, he asked Indians to stop buying gold for a year. The Prime Minister's remarks have drawn attention due to the cultural and financial significance of gold in Indian families. However, viewed from a macroeconomic perspective, the appeal appears to be about protecting India's foreign exchange reserves amid rising global uncertainty.
India imports most of its gold, which must be paid for in foreign currency, primarily US dollars. This means that every surge in gold demand creates additional dollar demand in the foreign exchange market. In 2025-26, India's gold imports rose by over 24% to an all-time high of $71.98 billion.
The jewellery industry is largely responsible for driving gold imports, with India being the world's second-biggest gold consumer after China. The Prime Minister's appeal has already had an impact on the market, with jewellery stocks slipping: Titan Company fell 1.12% to ₹5,045.50 and Kalyan Jewellers declined 4.50% to ₹587.