On April 14, the President signed a bill repealing an unpopular tax reporting provision in last year’s health care legislation that would have required all businesses to report transactions totaling at least $600 in a year for goods and services to the IRS. Although the proposed legislation would have adversely affected thousands of businesses, there was strong concern that this stealth legislation would have disproportionately affected people who own precious metals since the sale of a single ounce of gold would have triggered the reporting requirements.

China is one of the most important markets for gold, comprising 11% of global demand in 2009, up from 5% in 2002. The liberalization of gold by the People’s Bank of China in 2001 has impressively expanded consumer demand, which increased by 106% from 2002 to an estimated 443 tons in 2009, or an average of 8% per year.

India is the world’s largest gold consumer market, accounting for a staggering 15% of global demand. By 2020, its already massive consumption of 963.1 tons in 2010 will increase to an estimated 1200 tons per year according to the World Gold Council. India’s story is one of saving, rising real income levels, risk aversion and the cultural importance of gold, all factors which continue to drive demand in this important segment of the global market.