Give our bullion back: India wants its gold under own lock and key

Gold is quietly slipping back into national vaults across the world. What once sat comfortably in London and New York is now being packed up, shipped and locked away closer to home. Behind this movement is not a gold rush, but a question of trust. Who really holds your wealth when global economy — or politics — gets rough? India is moving faster than most, pulling most of its gold back under its own roof. And it is doing so in a world where even advanced economies are beginning to ask whether distance is safety or risk.

Also Read: RBI accelerates gold repatriation as global trust wanes

Why is India bringing back its gold

After it began repatriation of gold a few years ago, India’s central bank has sharply accelerated the return of its gold reserves. According to the Reserve Bank of India’s Half-Yearly Report on Management of Foreign Exchange Reserves (October 2025–March 2026), about 77 percent of India’s 880.52 metric tonnes of gold is now stored domestically. That means roughly 680 tonnes sit inside India, while around 197.67 tonnes remain with the Bank of England and the Bank for International Settlements. Another 2.8 tonnes is held as deposits.

The speed of this shift is striking. In just six months, the RBI brought back 104.23 tonnes, reducing overseas holdings significantly. In March 2023, only 37 percent of India’s gold was stored domestically. The change since then has been steady but clearly accelerating. This pivot could be due to a changing global risk environment, especially after the Russia-Ukraine war and the freezing of Afghanistan’s reserves by Western powers. Those episodes, involving G7 countries restricting access to sovereign assets, have reshaped how central banks think about custody. Gold under one’s own thumb also means ready liquidity which is of great importance in case of global economic crises.

Ritesh Jain of Pinetree Macro told ET: “In a world where the global monetary system is breaking down, I firmly believe that if gold is not in your possession, then it is not your gold. India is not an outlier here. Many countries are repatriating their gold from London and New York.”
That idea now sits at the heart of India’s strategy. Gold is no longer merely a balance sheet asset but something closer to strategic insurance, and insurance only works if you can actually access it. India’s broader reserve mix reinforces this shift. Gold now makes up about 16.7 percent of total foreign exchange reserves, up from 13.9 percent just months earlier, even as overall reserves declined to $691.1 billion. The direction is clearly of putting more weight on gold and exercising more control over where it sits.India’s reliance on foreign storage was driven by practical considerations: access to deep bullion markets in London, settlement efficiency, and institutional trust in custodians like the Bank of England. But as global financial power becomes more contested, those advantages are being weighed against a different risk: the possibility that assets held abroad may not be fully insulated from geopolitical decisions. India’s approach is therefore not an abrupt break but a steady rebalancing. It retains foreign custody for liquidity while steadily shifting the bulk home. The direction is unmistakable: reduce dependence without severing access.

The global vault system

For decades, the global gold system has rested on London and New York hold, which everyone else trusts. As per an NYT report, the Federal Reserve Bank of New York alone stores more than 500,000 gold bars, while the Bank of England holds around 430,000 bars and acts as a central hub for over 60 central banks. This system works because it is fast, liquid and historically trusted. This system emerged from decades of financial centralisation. London and New York became dominant not only because of security but because they function as active trading hubs where gold can be rapidly exchanged without physical movement. Krishan Gopaul of the World Gold Council told the NYT: “They want to hold it close to where they may transact.” In other words, proximity to markets still matters.

But the post-2022 world has complicated that logic. The freezing of Russian foreign exchange reserves after the Ukraine invasion introduced a new possibility into central bank thinking. Now, sovereign assets abroad may not be fully immune from political decisions. Even if gold itself was not broadly seized, the precedent of financial restriction has had a psychological impact. Such a concern, once limited to sanctioned states, has now spread to mainstream policymakers. The question is no longer whether vaults in New York and London are secure, but whether they are politically insulated. The vaults are still safe but the trust around them is what is shifting.

Repatriation, hedging and the return of physical sovereignty

Across countries, responses vary but the direction is broadly similar. They want to diversify custody, increase domestic storage and reduce dependence. France provides a clean example of a controlled adjustment. Bank of France completed an upgrade of 129 tonnes of gold previously held in New York, relocating it to Paris recently. Governor François Villeroy de Galhau said the decision was operational, not political, but the outcome still shifts physical control closer to home. The operation also generated 12.8 billion euros in capital gains due to high gold prices.

Germany shows a more politically charged debate. It holds about 3,352 tonnes of gold, with roughly one-third still in New York. Germany follows a more cautious path. It repatriated 300 tonnes between 2014 and 2017, yet continues to keep a significant share abroad. A Reuters report from last year highlighted renewed scrutiny after Trump’s return to the White House. Markus Ferber of the European Parliament told Reuters: “Trump is erratic and one cannot rule out that someday he will come up with creative ideas how to treat foreign gold reserves.” The Bundesbank, however, continues to defend its arrangement with the Federal Reserve as stable and reliable. That tension between political anxiety and institutional continuity defines much of Europe’s position.

Elsewhere, Poland is explicitly designing a balanced model. Its governor Adam Glapiński told NYT that domestic storage is about “national resilience and strategic autonomy,” while still maintaining exposure to London and New York for liquidity. The Czech Republic represents the opposite end of the spectrum, prioritising efficiency over relocation. Jan Kubicek of the Czech central bank told NYT: “We save money on transaction costs by using Bank of England vaults.”

When gold means gold in hand

India’s decision to bring most of its gold home is not an isolated policy tweak. It is part of a wider rethinking of what safety means in global finance. For decades, safety meant trusted foreign custody in deeply established financial centres. Today, safety is increasingly being redefined as physical proximity to sovereign control.

The infrastructure of global gold storage in New York and London remains intact and deeply embedded. But the assumption that underpinned it is weakening. Countries are no longer asking only whether their gold is secure. They are asking who ultimately controls access to it when politics turns sharp. India has answered that question more decisively than most. And others are quietly moving in the same direction, even if at a slower pace.