The erratic metal prices over the last few months has brought forth many debates on how and why gold is (and by some, as NOT) a good investment tool. For decades, India has seen heavy consumption of the yellow metal. But is investment the real reason why Indian consumers have horded gold all these years?

To understand this, we need to examine what role gold has played in a typical middle class Indian household. Gold in India is never bought with the mind, but is bought with the heart. Indian families view it as a store of value and prosperity to be used with a lot of discretion, only in rare and critical situations. And most remarkably, it is one of the few sources of wealth that is under female dominion. In a patriarchal society, it is not hard to understand why this value is tremendous and significant for the Indian woman. No wonder, women don’t count their jewellery in how many neckpieces, number of bracelets but in ounces.

Gold is something that a mother likes to pass on to her daughter; a mother-in-law to her daughter-in-law. Comparison is done with how much they had got in their times and every attempt is made to give more to the next generation; a sign of improving prosperity of the lineage. It is only when she has sought a certain comfort with what all she has at present, does the woman start indulging in the adornment and accessorization functionality of jewellery. That is when she starts talking of designs, stones and diamonds. Not to forget, it comes only after basic security is locked and sealed.

According to World Gold Council, India accounts for 10% of total world gold stock, of which rural India accounts for 65% of the total gold stock. During 2011- 2012, the annual demand for gold remained relatively stable at around 700 to 900 ounces.

Men too have encouraged this penchant for gold and jewellery that they have seen across generations. After all, it also serves as a symbol of their success, of being able to fulfil their role as ‘providers’ – a pretty visible symbol on display!

It is only in the last two decades that opportunities for women in work have increased and many more are getting into the workforce. And that brings in a wave of empowerment, mitigating to some extent the full reliance on inherited and accumulated gold as source of ‘personal power’. Their confidence in themselves, their individual caliber and potential in fighting off crises has seen a boost. That has impacted their view of gold and jewellery in general. Its locker appeal has given way to its appeal as enhancing femininity – a way to look and feel beautiful. Given the role gold has played in the Indian household, it clearly is not a regular investment tool and so, to compare it to other investment tools (like stocks and mutual funds) is fool hardy. We do not see people flocking to sell gold when prices are sky rocketing. In fact, the rationale of the metal’s strength gets stronger and more and more get into its fold! For an Indian woman, it represents far more than just X or Y rupees – a lot of her and her family’s ‘worth’ is associated with it. And, that is priceless!

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