Who buys most gold in Dubai souqs?

Have you ever wondered who is the biggest buyer of gold jewellery in Dubai’s gold souqs?

According to gold merchants and the Dubai Gold and Jewellery Group (DGJG), it is not Emiratis or Arabs or Europeans or even tourists… it is Indians, who as a single group purchase the most amount of gold and diamond jewellery.

And surprisingly, they have a penchant for a specific kind of gold… it is not 24kt. Indians, by large, prefer jewellery made in 22kt gold.

Indians love gold as it is connected to various important aspects of life - it is seen as an investment, has religious importance and is used as adornment.

“Undoubtedly, Dubai has the largest Indian expat population which boosts gold jewellery buying on a larger scale, especially during festive seasons like Dubai Shopping Festival,” the spokesperson for the Dubai Gold and Jewellery Group told Emirates 24|7.

Why is it that Indians buy gold? According to the DGJG: “The tax structure for gold in India further encourages consumers to purchase gold jewellery in Dubai.” Because of the tax in India, price of gold is higher than in tax-free Dubai.

Why 22kt gold? According to the DGJG: “Indians prefer the colour of their jewellery to be more yellow. Indians consider gold as an investment. The highest carat of jewellery they can avail in gold is 22kt. Therefore, they prefer that”.

24kt pure gold is soft and is difficult to make durable jewellery out of it for everyday wear. 22kt gold is the next closest to pure gold and is more tough and durable and that is why Indians prefer it.

Because of the large mixed population of Dubai, the gold market supplies gold jewellery to suit every culture and ethnicity. Naturally, there are preferences among customers when buying gold such as design, carats and whether it is handmade or machine made.

According to the Dubai Gold and Jewelry group here is what each nationality prefers to purchase when it concerns the carats of gold.

Follow Emirates 24|7 on Google News.