Why Gold Will Become More Important This week, CEA Nageswaran

Chief Economic Advisor V. Anantha Nageswaran, presented a strong argument for gold, describing it as a vital component of investment portfolios with an expanding role in the future. He noted during his remarks at the IGPC-IIMA Annual Gold and Gold Markets Conference 2025 on Monday that gold is more than just a flashy memento; it’s a wise strategy to diversify and safeguard wealth, particularly while the globe fumbles with what he refers to as a “international monetary non-system.

Gold’s Staying Power in Uncertain Times

Nageswaran didn’t mince words: gold’s relevance isn’t fading anytime soon. Beyond its cultural and religious value in India, it’s a solid store of wealth and a buffer against shaky markets. He believes this will hold true until a proper global financial system takes shape—something he admits is tough to predict. With its “likely ascending importance,” gold is shaping up to be a go-to asset for investors looking to balance risk.

Prices Are Telling the Story

The numbers back him up. Gold has jumped over $200 per ounce in just the last three months, hitting $2,860—an 8% climb. Meanwhile, the Indian stock market has taken a hit, dropping more than 8% in the same stretch. Looking back, gold’s value has soared tenfold since 2002, when it hovered around $250–290 per ounce. Today in India, you’ll pay about Rs 85,000 for 10 grams, a reminder of why this metal matters in a country that imports most of its supply.

India’s Gold Dilemma
Nageswaran also touched on a tricky challenge: how can India make better use of its gold without losing what makes it special? He’s hopeful the country can find a way to tap into these assets—think jewelry and family heirlooms—while keeping their emotional and cultural weight intact. “That’s where the policy challenge lies,” he said, nodding to past efforts like the 2015 Gold Monetisation Scheme, which aimed to cut imports by letting people earn interest on gold deposited in banks.

More Than Just a Metal
For Nageswaran, gold stands for something bigger—stability and discipline. He took a swipe at today’s policymakers and investors, pointing out how both seem to think printing money or demanding higher asset prices can fix everything. “Markets go both ways,” he warned, “but the clamor for relief just gets louder when they dip.” With global debt ballooning far beyond GDP levels, he reckons future earnings will get eaten up servicing that debt, leaving little for growth.

Inflation Keeps Gold in the Spotlight
Here’s where it gets real: high debt often tempts governments to let inflation run loose, shrinking the real cost of what they owe. Nageswaran tied this to the messy policy shifts since 1973, arguing that gold shines brightest when inflation looms. “Its importance isn’t going anywhere,” he insisted. In India, the debt-to-GDP ratio is set to ease from 57.1% in FY25 to 56.1% in FY26, while GDP growth could hit 6.3–6.8% next year—decent numbers that still don’t dim gold’s appeal.

What It Means for You
So, what’s the takeaway? Gold’s not just a relic—it’s a lifeline for investors navigating choppy waters. Whether you’re hedging against inflation or balancing a rocky portfolio, Nageswaran’s words suggest it’s time to pay attention. India’s love for gold isn’t slowing down, and as the world wrestles with debt and uncertainty, this metal’s role only looks set to grow.