Mumbai, May 18 - World Gold Council has predicted that China, the second largest economy in the world, may become the largest gold consumer overtaking India this year.
The demand for the yellow metal in that country touched a record high of 255.2 tonne during the January-March period while the demand dipped in India in the same period, a recent WGC report said.
In 2011, gold demand in China touched 769.8 tonne, which is likely to hit 900-1,000 tonne this year.
China's gold investment and jewelery demand reached 255.2 tonnes in the first quarter, up by 10 per cent over last year.
This growth was mainly due to the strong demand during the wedding season, Chinese new year and gifting for babies born in this auspicious year of the dragon, the report said.
Jewelery demand also increased in China significantly to 156.6 tonne, accounting for 30 per cent of the global jewelery demand, making the country the largest market for the third consecutive quarter.
Although the pace of growth in China is slowing, gold continues to benefit from rising income levels, increasing urbanisation, economic growth and the high inflationary environment, the WGC pointed out.
However, a 29 per cent decline in gold demand was registered in India during January-March period due to certain tax issues faced by the jewelery trade, increased import duty and the weakening rupee.
Last year, India imported 969 tonnes of gold, valued at a tad over USD 50 billion, while the demand was 933.4 tonne, which may fall to 800-900 tonne this year, it said. PTI