India's gold reserves have reached a significant milestone, with the total value surpassing $100 billion for the first time. According to data released by the Reserve Bank of India, the country's gold holdings increased by $3.595 billion to $102.365 billion in the week ending on October 10. Despite an overall decrease in foreign exchange reserves to $697.784 billion, the share of gold in India's total reserves has climbed to 14.7%, the highest since 1996-97.
The surge in India's gold reserves has been largely attributed to a global rally in gold prices, which have soared in recent months. The share of gold in India's foreign exchange reserves has almost doubled over the past decade, rising from below 7% to nearly 15%. This increase reflects both consistent central bank accumulation and the spike in global bullion prices.
Interestingly, the achievement of crossing the $100 billion gold reserve mark comes as the Reserve Bank of India has significantly reduced its gold purchases in the current year. In 2025, the central bank only purchased gold in four out of the first nine months, compared to regular acquisitions in 2024. The cumulative gold buying from January to September stood at just 4 tons, a sharp drop from 50 tons during the same period in the previous year.
Kavita Chacko, the research head for India at the World Gold Council, noted that the rise in the share of gold in India's foreign exchange reserves has been primarily driven by valuation gains due to the increasing gold price. In 2025, gold prices have surged by approximately 65%, influenced by a combination of macroeconomic, institutional, and psychological factors.
The trend of central banks worldwide accumulating gold as part of reserve diversification away from the U.S. dollar has also played a role in the growth of India's gold reserves. This shift has been fueled by escalating geopolitical risks, sanctions pressures, and the ongoing trend of de-dollarisation.
India's strong cultural affinity towards gold, as both an investment and a symbol of status, has further contributed to its status as the second-largest consumer of gold globally. The country heavily relies on imports to meet the demand for gold, underlining the deep-rooted tradition of buying and owning gold in Indian society.
