Gold prices do fluctuate, but actually they appreciate. However, investing in gold jewelry accounts for a loss when it has to be liquidated when one requires cash in hand. But in the case of Gold Bullion, the money that comes back is more than the investment. This is however unless and until other financial markets do not face a crisis, or the nation as a whole is not laid under financial troubles. In fact in over the last decade, gold has received a newer status of being a commodity, rather than just a mere asset.

The maximum purchase of gold bullion happens mainly in the Asian countries and more so in India, as a person’s wealth is determined by the amount of gold he has in his safe deposit vault. Some analysts believe that the demand for gold is linked with economic prosperity, since gold is used as jewelry. While there are traders who constantly buy and sell gold bullion, which so to speak implies trading in gold bullion, there are times when its purchase increases due to other reasons. Like during the Indian wedding seasons that occur at least twice a year, purchase of gold bullion increase.

In agricultural India, people prefer to buy gold rather than stack cash. Also according to Economists, people living in rural India do not earn taxable income so they convert their earnings into gold.

Non Resident Indians (NRIs) are permitted to bring into India upto 10,000 grams of gold once in six months. However, they should have lived abroad constantly for six months at a stretch. The gold they carry with them maybe biscuits or jewelry. They are required to pay a Custom Duty of Rs. 220 per ten grams.

Though India may not list amongst the major gold producing countries such as South Africa, United States Australia, China, Canada, Russia, Indonesia, Papua New Guinea, Ghana, Brazil, Argentina, etc., yet it accounts for being the largest gold consumer in the world.

In India, MMTC Limited ( a Government of India enterprise) imports and supplies bullion to the exporters under various provisions of Foreign Trade policy.