Which City Has the Lowest Gold Price in India?

Gold is currently trading at an all-time high, yet demand in India remains unchanged. South India leads the gold jewellery consumption with 40% of the nation's overall jewellery demand. This is because Southern Indian states have the lowest gold price in India.

Gold has always been a sign of prosperity, wealth, security, and cultural significance in India. It is also a great investment avenue for individuals looking for slow but stable growth. The buying decision, however, is always influenced by the gold price, which varies from city to city. In this blog, we will explore the cities with the lowest gold prices in India.

Which City Has the Lowest Gold Price in India?

Here are the top 10 cities with the lowest gold prices in India:

Note : The prices are recorded on 01-09-2025*

Why is Gold Less Costly in Southern Cities?

The table clearly indicates that South Indian cities and states have the lowest gold prices in India. Here are the 3 key reasons why gold prices are usually lower in southern states:

• Cultural demand: Gold holds a special place in South Indian culture. Whether it is a wedding or a festival, gold is widely used and considered a symbol of prosperity, purity and blessings.
• Access to ports: Kerala and Tamil Nadu enjoy better access to imported gold due to proximity to nearby ports, which translates into lower logistics prices.
• Competitive market: With numerous gold jewellers in these states, naturally, competition makes the prices lower for buyers by default. Due to strong demand, gold prices are lower to ensure competitiveness.

Also Read: Understanding Import Tax on Gold in India - 2025

Why Do Gold Prices Vary Across Cities?

Gold prices vary across India, and even minor city-wise differences can impact jewellery costs. While international rates set the benchmark, local factors also influence final pricing:

1. Import Duties and Tariffs

As India imports most of the gold, the rate is greatly influenced by import tariffs levied by the state. This is why tariffs and import duties significantly impact gold prices in local markets. Institutions such as MMTC and STC, as well as banks such as ICICI Bank, SBI, and HDFC, undertake such imports.

2. Local Taxes and Cess

Every state has a different taxation system. Gold purchases in India attract a Goods and Services Tax (GST) of 3% on the gold’s value. The government also charges a 6% customs duty on gold purchases. Together, these applicable charges lead to some variance in the gold prices in every city.

3. Bullion Associations

All major cities have a Bullion association that sets the daily gold prices twice a day. The India Bullion and Jewellers Association (IBJA) is one such association that decides the highest and lowest gold prices in India based on international rates, fluctuations in dollar-rupee value, and domestic demand.

4. Demand and Supply Chain

The demand for gold constantly changes from state to state. As stated earlier, South India alone accounts for 40% of the country’s jewellery consumption. While festivals, weddings, or tribal rituals create a strong demand, prices slowly rise as jewellers increase their margins. In less seasonal states, gold prices are slightly lower.

5. Accessibility and Logistics

Some states, such as Kerala and Maharashtra, are closer to the ports that import gold. This makes gold more affordable in terms of logistics and marginally cheaper than in landlocked states, where logistics have additional costs.

6. Inclusion of Jeweller Margins and Making Charges

Jewellers add their profit margins and making charges, which are not technically part of the gold price. These extra charges also differ from city to city. Jewellers usually charge low margins in areas with high competition, such as the cities of Chennai or Kochi.

Also Read: Common Gold Units: Ratti, Gram, and More Explained

To Conclude

Gold has been and will always be one of the safest investments in India and worldwide. Its cultural significance, on the other hand, always keeps it in high demand. Since the gold bar price varies across different cities in India, tracking the lowest gold price in India is essential to maximise your investment.

FAQs

Why is gold cheaper in Southern cities than in the North?

The gold price is lowest in Southern cities compared to Northern cities because of proximity to import hubs, lower local charges and high demand.

Can I save money by buying gold in one city and selling it in another?

Even though price differences exist, additional travel, taxes, and jeweller charges usually cancel out the profit.

Do bullion associations really decide gold prices in each city?

Yes, local bullion associations (India Bullion and Jewellers Association) update prices twice daily, influenced by international rates and regional demand.

Is the gold bar price in India the same across all cities?

No, while international prices form the base, local taxes and logistics mean the gold bar price in India varies slightly between cities.

What is the gold bar price in India today?

The gold bar price in India varies by city and state, depending on factors such as weight, purity, making charges, and local tax.