Hyderabad, Telangana: Prime Minister Narendra Modi, during his recent visit to Hyderabad, appealed to the people of the country to reduce gold purchases for one year in order to help strengthen India’s economy amid rising global economic pressures.

India has traditionally been one of the world’s largest consumers of gold, with a significant portion of demand met through imports. However, gold prices have surged sharply due to ongoing geopolitical tensions in Western countries and uncertainty in international markets.

Addressing the issue, Modi urged citizens to cooperate in protecting the country’s foreign exchange reserves by limiting unnecessary gold purchases, reducing avoidable foreign travel, and exercising caution in the use of petrol, diesel, and cooking gas. He emphasized that such measures could help reduce the burden of imports and strengthen the Indian economy.

India currently imports nearly 90 percent of its gold requirements from foreign markets. Reports indicate that the country imports around 700 to 800 tonnes of gold every year. Due to rising international prices, the total value of gold imports during the financial year 2025-26 reached a record USD 71.98 billion.

At the same time, India’s trade deficit has widened further because of increasing crude oil import costs. Economists warn that higher gold imports are putting additional pressure on the Indian rupee and foreign exchange reserves.

According to data released by the Reserve Bank of India, the country’s forex reserves have witnessed a notable decline in recent months. Experts also point to rising crude oil prices linked to the Israel-Iran conflict as another major concern, especially since India depends on imports for nearly 80 to 85 percent of its oil requirements.

Meanwhile, Modi’s remarks had an immediate impact on the stock market, with shares of several leading jewellery companies witnessing a sharp decline.

However, market experts believe the long-term demand for gold in India is unlikely to weaken significantly. Gold continues to hold strong cultural, traditional, and investment value among Indian consumers. Analysts expect that while purchases may slow temporarily, demand is likely to recover in the future.