Indian gold ETFs ended 2025 on a strong note, with net inflows reaching an all-time high of Rs 116 billion (US$1.29bn) in December, according to data from the Association of Mutual Funds of India, reported World Gold Council (WGC). Rs 43,000 crore was invested by Indians in Gold ETFs in 2025.
“This marked the eighth consecutive month of net additions, underscoring sustained investor demand for gold-backed funds. Cumulative holdings increased by a record 8.6t in December, lifting the total to a historic high of 952 tonnes in line with our estimates,” said WGC in the report.
Investor appetite was supported by muted equity market performance and sustained gold price momentum, reinforcing the role of gold ETFs as a preferred portfolio diversifier.
2025 was a standout year for Indian Gold ETFs
Net inflows of INR 430 bn or Rs 43,000 crore (US$4.9bn) and net demand of 37t were the highest on record, accounting for 5% of global gold ETF flows and demand. 1 billion is Rs 100 crore.
Assets under management (AUM) of gold ETFs grew to INR1,279bn (US$14.2bn), increasing India’s share in global gold ETF AUM from 1.9% in 2024 to 2.5% a year later. Within the domestic mutual funds universe, the share of gold ETFs also increased from 0.7% to 1.6%.
The investor base also expanded sharply during the year, with a 60% y/y increase in accounts (folios). At the end of December, total folios reached 10.2 million, with 3.8mn new accounts added in 2025, underscoring the growing adoption of gold ETFs among investors.
Gold Returns
Gold is making a strong comeback in 2026 after rising more than 65% last year. Gold jumped over $100, gaining 2% in a single day to trade at $4,867. Gold is inches away to hot the $5,000 mark, for the first time in history.
The demand for yellow gold is not abating, with central banks and global gold funds leading the prices higher. The global political and economic scenario has been a key driver for gold prices to rise 145% in the last 3 years.
Gold ETF
Gold exchange-traded funds (ETFs) have gold as the underlying asset and are traded on stock exchanges. The biggest plus point of Gold ETFs compared to physical gold is the cost of ownership. Compared to jewellery’s making charges, the expense ratio in Gold ETFs is around 0.8%. The Demat charges and the Tracking error of the fund are additional costs, but still much less than owning physical gold.
The other big advantage is that the price of gold that Gold ETFs track is transparent and standard. The price you will pay for 1 unit of Gold ETF is probably the closest to the actual gold prices. Further, there are no concerns of purity, safety and storage.