Skyrocketing gold costs dampen Kashmiri wedding celebrations

Srinagar, May 17:  The jingling of gold bangles and the glittering of jewel-encrusted necklaces have long been the soundtrack of Kashmiri weddings. But this year, as the Valley’s marriage season kicks into high gear, the exorbitant cost of gold has cast a pall over the celebrations, forcing families to tighten their purse strings.

The markets of Hari Singh High Street and Maharaj Gunj, the once-bustling jewellers’ quarters now stand hauntingly quiet.

Gold prices have skyrocketed to a staggering Rs 73,500 per 10 grams in the bullion market, shattering dreams and upending centuries-old traditions.

“I had been saving for months to buy gold for my sister’s wedding, but the prices have become so high that it’s now completely out of reach,” said Junaid Mushtaq, a resident. “This is a devastating blow for a middle-class family like ours.”

The exchange of gold between the bride and groom’s families is a deep-rooted custom in Kashmir.

However, the current exorbitant rates have rendered this tradition nearly unattainable for many.

Javid Ahmad, a local goldsmith, paints a grim picture of the industry's plight.

“The demand for gold, especially among upper-middle-class and middle-class families, has plummeted,” he says. “Only the affluent households can afford to keep the tradition alive, leaving a substantial void in the market.”

The impact of the soaring prices extends far beyond the realm of weddings.

Historically, gold has played a pivotal role in Kashmiri families’ wealth accumulation and has been an integral part of festivals and cultural events.

But the recent surge has disrupted this age-old practice, prompting families to reconsider their investments.

President of the All Kashmir Valley Gold Dealers and Workers Union, Bashir Ahmad Rather expressed grave concerns about the dire state of the gold business in Kashmir.

“The onslaught of soaring prices has significantly impacted demand, with families shying away from purchasing gold due to its high costs,” he said. “While we hope the upcoming marriage season might boost demand and provide some relief, the current challenges and uncertainty regarding a significant price reduction persist.”

At the national level, India’s gold demand hit a six-year low in May 2023, excluding the COVID-19-affected year of 2020, with a 17 percent decrease in the March quarter compared to the previous year.

The All India Gem and Jewelry Domestic Council (GJC) anticipates global economic uncertainties and geopolitical tensions to drive gold prices even higher, reaching an estimated Rs 74,000 per 10 grams in 2024, making it an attractive safe-haven investment and a hedge against inflation.

Gold prices in India have been fluctuating recently, with the rates in Delhi currently standing at Rs 6775 per gram for 22-karat gold and Rs 7390 per gram for 24-karat gold.

Across India, the price of 24-karat gold on Friday was Rs 7348 per gram, reflecting a slight increase of Rs 55 from Thursday.

Several factors influence the gold prices in the country, including global market conditions, the strength of the US dollar, inflation rates, supply and demand dynamics, interest rates, and overall economic stability.

Gold holds significant cultural importance in India, especially during the wedding season, as it is viewed as a symbol of prosperity and a reliable investment for preserving wealth.