With Union Budget 2026 just 10 days away, the precious metals industry is advocating for transformative reforms as gold and silver prices reach unprecedented levels. Industry leaders view the upcoming budget as a crucial opportunity to modernize how Indians invest in gold, particularly through digital platforms and formal financial instruments.

Record Gold Prices Drive Investment Shift

Gold prices have surged to lifetime highs this week, with rates approaching ₹1.50 lakh per tola. This dramatic price appreciation has created both opportunities and challenges for the market.

The price rally has rewarded long-term investors but highlighted a structural challenge: a substantial portion of household gold remains in physical form, offering limited contribution to the broader economy.

Digital Gold Awareness Campaign Needed

Mahendra Luniya, Chairman of Vighnharata Gold Ltd, emphasizes the urgent need for government intervention to promote digital gold adoption. "If we look at the goal of Viksit Bharat 2047 from a logical and economic standpoint, it becomes clear that India must unlock the vast amount of gold lying idle in households and integrate it into the digital economy," Luniya stated.

Gold Exchange-Traded Funds (ETFs) allow investors to gain gold price exposure without physical ownership. These instruments track domestic gold bullion prices and trade on stock exchanges like shares, with each unit typically representing one gram of high-purity gold held by the fund. Similar mechanisms exist for silver ETFs.

Economic Impact of Household Gold Integration

The industry argues that converting physical gold stored in homes into digital assets could significantly accelerate economic growth. According to industry estimates, shifting even a small portion of household gold savings into digital instruments could provide substantial capital availability and enhanced economic activity.

"This effectively locks a massive amount of liquidity inside private vaults instead of allowing it to circulate within the Indian economy. Digital gold offers a practical solution to unlock this value," Luniya explained.

Sovereign Gold Bond Revival Sought

A key expectation from Budget 2026 is the revival of the discontinued Sovereign Gold Bond (SGB) scheme. Industry leaders consider SGBs among the most effective policy measures in the gold sector.

"The impact of Sovereign Gold Bonds was clearly visible; public awareness increased, and behavioural change began to take place. Unlike many schemes that incur fiscal losses, SGBs allowed the government to access capital without financial strain while productively utilising household gold savings," Luniya noted.

Transformation Challenges and Opportunities

The transition from physical to digital gold faces inherent challenges, as many consumers still prefer purchasing gold as jewellery or coins. However, industry leaders believe that major budget announcements focused on awareness campaigns could demonstrate how India can effectively invest and monetize its most trusted asset.

The industry's expectations center on government initiatives that could integrate household gold savings into the formal financial system, supporting long-term economic objectives while maintaining investor confidence in gold as a reliable investment option.

Spot silver has experienced a dramatic decline, extending its recent losses to trade at $80.49 per ounce. The precious metal has fallen over 30%, marking a significant downturn in silver prices.

Current Market Performance

The latest trading data shows spot silver continuing its downward trajectory, with the metal now priced at $80.49 per ounce. This represents a substantial decline of over 30% from previous levels, indicating intense selling pressure in the precious metals market.

Market Dynamics

The extended decline in spot silver reflects the challenging conditions currently facing precious metals. The over 30% drop demonstrates the significant volatility that has characterized silver trading, with the metal unable to find support at current price levels.

The continued weakness in silver prices highlights the broader pressures affecting the precious metals sector, as investors navigate uncertain market conditions and shifting commodity dynamics.