Trade bodies are warning that gold prices could see short-term volatility.
GJC highlighted Dubai's central role in global bullion trade as a particular concern.
Gold prices were hovering around ₹1.6 lakh per 10gm.
India's jewellery industry is bracing for a turbulent run-up to one of its most important selling seasons of the year. With geopolitical tensions across West Asia showing no signs of easing, trade bodies are warning that gold prices could see short-term volatility in the weeks ahead of Akshay Tritiya — the auspicious occasion that reliably triggers one of the country's biggest annual surges in gold buying.
The All India Gem and Jewellery Domestic Council (GJC) highlighted Dubai's central role in global bullion trade as a particular concern. The emirate serves as a critical gateway through which gold flows into Asian markets, including India, and any sustained escalation in the region risks disrupting bullion liquidity, fracturing supply chains and distorting price discovery at a moment when the market can least afford it.
2 March 2026
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Despite the uncertain backdrop, the industry is not expecting demand to collapse. The wedding season is in full swing, cultural attachment to gold remains as deep as ever, and the expanding footprint of organised retail has introduced a degree of resilience that the sector lacked in earlier cycles. When prices rise sharply, GJC noted, Indian consumers have shown a consistent tendency to adapt rather than retreat — shifting towards lighter gold pieces and diamond-studded designs.
India's position in the global diamond trade adds another dimension to the sector's current vulnerabilities. The country processes over 90% of the world's diamonds by volume, with Surat and Mumbai at the centre of that industry, supplying polished stones to buyers across the United States, Europe, West Asia and Asia. With Gulf supply chains already under pressure from the wider conflict, the diamond processing hubs that depend on rough stone imports from the region face their own set of risks as the situation develops.
Gold Prices
On Tuesday, gold prices were hovering around ₹1.6 lakh per 10gm in Delhi. So far, gold prices failed to rally in a meaningful way.
Commodity analysts at UBS noted that gold has been unable to break out above $5,200 per ounce since the start of the Iran conflict, with its supposed safe-haven bid failing to materialise.
“In the short term, higher energy prices and inflation worries have led to a stronger US dollar and concerns over potential rate hikes—both are negative for gold prices,” the analysts added.
This creates a contrast to its 65% rise last year. However, it is expected that outbreak of the Iran war, the updated calculus of risk, interest rate policy, inflation, and strong underlying demand will still propel the yellow metal as high as $6,200 per oz by the end of 2026.
