Ahead of the Hindu festival of Diwali, the jewellery market in Indian capital Delhi’s vibrant Lajpat Nagar neighbourhood is teeming with crowds.
Shops have stayed open even on holidays, and at dusk, dozens of cars line up the streets as a string of flashy signboards beckon shoppers into the flower-adorned stores.
Soaring gold prices – which have topped $1,440 (£1,081) for 10g – may have slightly dented demand for jewellery in the world’s second largest market for the yellow metal this year, but Indians are not willing to entirely give up on their penchant for gold yet.
Diwali, along with Dhanteras – a smaller festival that falls on Saturday this year – are believed to be auspicious occasions to buy precious metal, with hundreds of thousands of Indians flocking the markets to buy gold and silver coins, bars and jewellery, which they believe bring wealth and luck.
Skyrocketing prices have created FOMO – or the fear of missing out – in the minds of buyers, who are worried prices might rise even further, Prakash Pahlajani, who runs Kumar Jewels, a family-owned business, told the BBC on a busy evening at his shop.
“As a result, I have more customers this year,” Mr Pahlajani said.
But with prices – gold is up 60% and silver 70% – shooting through the roof, jewellers are having to change tack to counter stagnant customer budgets.
“People are not saying ‘I don’t want to buy’. Instead, they are saying, ‘I’ll buy a little less,” said Tanishq Gupta, another jeweller down the road from Mr Pahlajani’s shop.
He said he’s had to be innovative and design pieces that look elaborate but have a reduced quantity of gold in them. A coin made of 250mg gold, which he sells for as low as $35, is now thinner but made to look as big as the heavier ones.
Coins weighing a tenth of that, at 25mg, are also on offer in the market.
Pushpinder Chauhan, another retailer in the area, said higher prices had also exacerbated the growing preference for lighter jewellery this year, “especially among younger buyers” who want pieces for everyday wear and not just special occasions.
