Indian Gold ETF holdings up by over 200% in 5 years : Zerodha Mutual Fund

Gold ETF holdings in India have surged over 200% in the last five years, rising from around 21 tonnes to over 63 tonnes, according to Zerodha Mutual Fund. This sharp increase suggests that gold ETFs are becoming a more popular way for Indians to invest in gold, alongside traditional options like jewellery and physical gold.

Gold ETF holdings refers to the total amount of gold that is held by the various Gold ETFs listed and traded on Indian stock exchanges. It may also suggest a greater demand for gold as an investment vehicle in its dematerialised form in the Indian market.

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The number of Gold ETF folios has witnessed more than a 13-fold increase from March 2020 to March 2025, offering investors a convenient and efficient way to participate in the gold market without the hassle of physical storage, said the release.

When it comes to taxation, Gold ETFs are taxed similarly to equities. LTCG is taxed at a flat 12.5% after 12 months of holding. On the other hand, STCG is taxed as per slab rates. In case of Physical Gold - the LTCG is taxed at 12.5% if held for more than 24 months, and STCG is taxed as per Slab Rate.

“The growth of Gold ETFs in India signifies a growing investment landscape where investors are increasingly embracing the ease and accessibility of gold through the mutual fund route,” said Vishal Jain, CEO of Zerodha Fund House.

Beyond its aesthetic appeal, gold holds a prominent position in India's investment landscape. Both urban and rural consumers alike recognise its enduring value as a reliable store of wealth.

This conviction is evident in India's strong appetite for gold coins and bars, with investment reaching about 239 tonnes in 2024, second only to China.

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In rupee terms, this translates to a demand of Rs 1.5 lakh crore, a significant 60% increase over the previous record set in 2023, demonstrating a broadening investment interest.

In 2024, India stands as the largest consumer of gold jewellery globally, with consumption reaching more than 563 tonnes with the annual demand valued at Rs 3.6 lakh crore.

Gold jewellery remains an integral part of India's cultural fabric, used in celebrations from grand weddings to auspicious festivals, symbolising tradition and prosperity

On the occasion of Akshaya Tritiya, Zerodha Fund House notes that in India, gold is far more than just a precious metal, with its significance deeply ingrained in the country’s history and culture. The last three decades have seen India's relationship with gold develop in notable ways. From a demand of 340 tonnes in 1992, the nation's appetite for Gold surged to more than 800 tonnes by the end of 2024.