Prime Minister Narendra Modi’s appeal urging Indians to avoid buying gold for a year amid economic stress linked to the West Asia crisis has triggered anxiety across the country’s jewellery and bullion markets, with traders fearing a sharp hit to demand, jobs and wedding-season business.
From Mumbai’s iconic Zaveri Bazaar to Delhi’s Chandni Chowk and Kolkata’s Bowbazar, jewellers and bullion traders are could create uncertainty among buyers at a time when the industry is heavily dependent on wedding-related demand.
Traders and jewellers are worried not just about lower sales during the wedding season, but also about the ripple effect a demand slowdown could have on thousands of karigars, goldsmiths and workshop labourers dependent on the jewellery trade for daily income.
“This appeal has created a stir among traders associated with the jewellery and business across the country,” Brijesh Goyal, Chairman of the Chamber of Trade & Industry (CTI), told IndiaToday.in over a phone call.
He noted that India consumes around 700-800 tonnes of gold annually and remains among the world’s largest gold consumers. “If consumers stop buying gold for a year, consumption could fall from nearly 800 tonnes to around 500 tonnes,” Goyal said.
The industry’s concerns stem from the fact that India is the world’s second-largest gold consumer after China, where demand extends beyond weddings and festivals to household savings and investment purchases.
Small jewellers, goldsmiths, karigars and workshop operators fear that any sustained decline in demand could severely impact livelihoods across the jewellery ecosystem, much of which operates through small businesses and informal labour networks.
“Small jewellers, artisans and goldsmiths are worried that they may face difficulty paying salaries to workers if sales decline substantially,” Goyal said, adding that layoffs could become a possibility if the slowdown persists.
The jewellery industry is also worried about the impact on key buying periods such as Dhanteras, which account for a significant share of annual gold sales in India.
“In India, gold is deeply connected with weddings, traditions and household savings. Such appeals create fear among buyers and can affect purchasing decisions,” Goyal said.
According to him, the industry fears losses running into nearly Rs 10,000 crore if gold demand witnesses a prolonged decline following the Prime Minister’s remarks.
An industry source, who did not wish to be named, said he was shocked by the Prime Minister’s appeal given the possible impact it could have on the sector.
“The gold and jewellery industry is huge. It is not just about customers buying jewellery. Thousands of families, karigars and labourers depend on this ecosystem for their livelihood,” the source said.
The source added that if consumers significantly reduce gold purchases, weak demand could eventually trigger large-scale job losses across the industry.
“The government should come out with some clarification because this has created uncertainty in the market,” the source added.
CTI has now sought a meeting with the Prime Minister to present the concerns of traders, jewellers and small businesses associated with the sector.
“We want to meet the Prime Minister and explain the possible impact this could have on jewellers, small traders, karigars and workers dependent on the industry,” Goyal said.
However, market experts said the government’s concerns over rising gold imports stem from growing pressure on India’s external balances. And in case you are wondering how India could benefit economically if gold buying slows for a year, we had earlier .
“India imported nearly $72 billion worth of gold in FY26, a record high, while the IMF has projected India’s current account deficit at $84.5 billion in 2026,” said Dr Renisha Chainani, Head of Research at digital gold and bullion platform Augmont.
“Some customers have already started postponing large purchases, waiting to see whether the government announces additional measures related to gold imports, taxation, or digital investment alternatives,” she said.
At the same time, Chainani said a complete collapse in demand was unlikely despite concerns within the jewellery industry. “Panic is not the right word. Pragmatism is,” she said.
“Akshaya Tritiya, Dhanteras, and wedding-season buying will not simply stop on a PM’s appeal. Gold in India is not discretionary — it is constitutional to the family balance sheet.”
Chainani added that the Prime Minister’s appeal could accelerate a gradual shift toward digital gold, recycling and monetisation of existing household gold stock instead of fresh bullion imports.
For thousands of small jewellers, karigars and workshop labourers, however, the bigger worry now is whether hesitation among consumers today could eventually snowball into a livelihood crisis in the months ahead.