By Mike Maharrey, Money Metals Exchange

Gold exports from Peru to India are poised to set a record in 2024 as demand grows in the world’s second-largest gold-consuming country. 

According to Peru’s ambassador to India, Javier Manuel Paulinich Velarde, gold exports to India are projected to rise by 36 percent year on year to a record $3 billion.

Velarde told the India Gold Conference that gold exports surged through the first half of the year, up by 81 percent.

According to Reuters, Velarde attended the conference hoping to drum up Indian investment in Peruvian gold-mining projects. He noted that last year, India became Peru’s second-biggest customer for gold. China, Canada, Mexico, and the U.S. all invest in Peru’s mining sector.

Velarde said the country currently has six major gold projects in the investment stage with a total buying investment of $7 billion. 

Indian gold demand has picked up in 2024, despite record high prices. It got a shot in the arm in July when the Indian government cut taxes on gold and silver imports by more than half, lowering duties from 15 percent to 6 percent. 

The domestic gold price fell 6 percent month-on-month after the lower duty went into effect, even as the dollar price of gold increased.

At the India International Jewellery Show earlier this month, manufacturers reported a “substantial” increase in order booking from retailers.

Gold coin and bar investment demand have also been strong through the first half of the year. 

World Gold Council analysts said that the lower import taxes could boost Indian gold jewelry, bar, and coin demand by 50 tons or more in the second half of 2024. 

Demand for silver has also surged in India. As Indian households gain purchasing power, demand for appliances such as air conditioners, washing machines, and refrigerators has skyrocketed. This has put a strain on the country’s energy grid. 

According to Jon Forrest Little, “The surge in demand for modern amenities has also created an unexpected pressure point: the need for silver, a crucial component in many electronic devices and appliances due to its superior conductivity.”

India imported more silver through the first four months of 2024 than it did in the entirety of last year.

The country ranks as the world’s number one silver consumer.

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