Same could be said about a Van goah painting or for that matter diamond - NO UTILITY. Gold is considered an asset class in India and Asia. Indians prefer to invest in real estate, gold, fixed deposit, bonds and equities in the order. Gold sales in India is down partly because of the govt restrictions and partly due to subdued economic growth. Govt/reserve bank are taming the current a/c deficit and once that is done gold import restrictions could be lifted. Indians presently need to pay more than the market price for gold. they also might be concerned about gold price projections coming from the western strategist. If gold does not hit $1000 by year end as predicted by goldman sachs, IMO demand from India will be back.
Poor demand in India due to govt intervention might be the cause for gold's price correction. Chinese might buy more than Indians this year but may not be able to offset reduced demand from India. In addition, despite gold price correction, the exchanged products like GLD are not buying much. So Exercise caution. I like GLD at these levels but the headwinds may not be in my/bull's favor.