The flow of customers to gold jewellery stores in Amritsar has dropped sharply, with jewellers reporting an estimated 50 per cent decline in footfall over the past two days, following Prime Minister Narendra Modi’s appeal for austerity and reduced discretionary spending.
Industry representatives said the sentiment-driven slowdown has been immediate, with buyers adopting a “wait-and-watch” approach after the PM’s suggestion urging citizens to avoid gold purchases for a year as part of broader efforts to manage economic pressure linked to global uncertainties, including the West Asia crisis.
Leading jeweller Pankaj Khurana said the Prime Minister’s appeal has had a “significant impact” on consumer behaviour. While some wedding-related purchases continued briefly earlier in the week, he said overall demand has weakened noticeably since then.
“People who had planned purchases for weddings did come in initially, but thereafter the market has gone quiet. Customers are now unsure and waiting to see how the situation evolves,” Khurana said.
He added that while the government’s intent may be to promote austerity, the move has raised concerns within the jewellery trade, which supports a large ecosystem of artisans, workers and retailers.
Amritsar is among northern India’s key hubs for gold jewellery manufacturing and trade, with thousands dependent on the sector for livelihood.
Vijay Mehta, president of the Civil Lines Jewellers Association, said negative sentiment has clearly impacted business. He also pointed to recent policy changes, including the reported increase in import duty on gold and silver from 6 per cent to 15 per cent, which has pushed prices up by nearly Rs 10,000 per 10 grams.
He said rising duties, combined with weak sentiment, could have a “debilitating impact” on manufacturing units and retail stores.
While the duty hike is aimed at reducing the country’s import bill amid volatile global conditions, traders fear it will further dampen demand in the coming months.
Mehta also expressed concern over advisory suggestions discouraging gold purchases for an extended period, saying gold jewellery remains deeply rooted in Indian cultural traditions, especially in weddings and family occasions.
“Whether sales happen or not, fixed costs remain, wages, electricity, maintenance and overheads. A large workforce of skilled artisans and workers depends on this industry,” he said.
