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GOLD JEWELLERY CONSUMERS
RURAL VERSUS URBAN DEMAND
The sentiment of leading retailers suggests that the urban population may account for as much as 40% of
gold jewellery purchases at this time.
Their estimates of urban demand in 10 States range from 40% to 65%.
State Indicative % split of demand
within the State
Urban Rural Total
population population
Maharashtra 65 35 100
Uttar Pradesh 60 40 100
Punjab 50 50 100
Rajasthan 50 50 100
Gujarat 50 50 100
Kerala 55 45 100
Andhra Pradesh 40 60 100
West Bengal 40 60 100
Karnataka 40 60 100
Tamil Nadu 40 60 100
Range 40-65 35-60 100
Source: Leading jewellery retailers in major cities.
Although their indicative estimates for their States may not be accurate, large retailers generally report that urban demand
(i.e. purchases by the population living and working in urban areas) became more important during the 1990s due to high
industrial growth. In recent years, the agricultural sector in many States has been relatively depressed.
Retailers also observe that the rural/urban split is not a static proportion. The rural population’s proportion is likely to
increase in the future, especially in years when the agricultural economy is particularly strong.
REGIONAL DEMAND
Retailers, wholesalers and bullion dealers throughout the country report that the south is the most important
gold jewellery market.
Trade estimates of the south’s market share range from 35% to more than 50%.
While there is consensus that the east has the lowest share, there is some disagreement over the relative size of the west
and north.
Anecdotal evidence suggests the following approximate split:
Region Market share
% Split
South 40
West 20-25
North 20-25
East 15
Total 100
Anecdotal evidence also indicates that the following States are particularly important within their regions.
South. Tamil Nadu may account for 35%. There is little consensus about the relative size of Andhra Pradesh,
Karnataka and Kerala. They are all large. The small State of Kerala is regarded as having the highest per capita
consumption in the south and nationally.
West. Gujarat and Maharashtra may account for 75%. Madhya Pradesh and Chhattisgarh are viewed as less important.
North. Uttar Pradesh and Punjab may account for 40%. Many large consumers in the north rely on New Delhi
retailers. Rajasthan and Haryana (bordering New Delhi) and the other States are considered less important.
East. West Bengal may account for 40%. Bihar and Orissa are regarded as less important. The small border States in the
North East (Assam and others) are considered significant.
AN INTRODUCTION TO THE INDIAN GOLD MARKET 121