Chief Economic Advisor V Anantha Nageswaran said on Monday that gold will remain relevant for investors as a portfolio diversification mechanism with a “likely ascending importance” as an asset class in the coming years.
Speaking at the IGPC-IIMA annual gold and gold markets conference 2025, the CEA said the gold will remain relevant not only as a store of value, as an ornament for cultural and religious purposes, but also as an important portfolio diversification mechanism “until such a time the world is able to arrive at an international monetary system from the current international monetary non-system”.
“That day of reckoning is very difficult for any one of us to prophecy at this stage,” he said.
CEA Nageswaran said it is very important to remember the relevance and the importance of gold for a portfolio, a store of value etc, more so in the backdrop of the likely ascending importance of gold in the coming years.
He also hoped that India would find ways to productively deploy the gold assets that it has without diluting its role as a symbol of the store of value as well as cultural and religious significance.
“That is where the policy challenge lies,” he said.
“India needs to reflect upon its past gold monetisation efforts to pay back the owners who deposited gold in currency form.”
“…but probably people attach different significance to gold, and sometimes we tend to forget that in policy deliberation,” he added.
The value of gold has increased by over USD 200 per ounce or 8 per cent in the last three months to USD 2,860 per ounce. At the same time, the Indian stock markets have fallen over 8 per cent over the last three months.
It is to be noted that since 2002, the value of gold has gone up 10 times when it was about USD 250-290/ounce.