India, the world's largest consumer of gold jewellery, is becoming a hot destination for gold fabrication business.

All these years, countries like Italy used to be a big market for processing of the yellow metal. But lately, global retailers are turning their attention to countries like India and China for gold fabrication work because of the low cost.

"Yes, surely, the low cost of operation in India attracting a good chunk of gold fabrication work to cities like Mumbai, Ahmedabad and Surat," said bullion expert Raghuram Dev.

He said accelerating fashion cycles, relative factor costs between manufacturing and consuming nations and volatile metal prices are triggering the drive towards moving fabrication works to low cost countries like India.

Quoting a recent study, Dev said global jewellery fabrication output would grow at a CAGR of 5.1% to reach $95 billion by 2015.

"China and India would be the new centres for fabrication of studded jewellery, as the US' share would decline. Turkey would take over a significant share of the market from Italy," the study said.

Dev said if this trend catches up India and China will be the biggest beneficiaries.

Till sometime back, Italy used to process gold and supply to global retailers like the Wal Mart. But now, these retailers are looking at low cost countries for processing of gold.

Experts say India can definitely leverage on this new emerging business if the domestic players invest considerably on gold fabrication works.

Some key highlights of India as gold destination:

• India is the world's largest consumer of gold jewellery
• India contributes about 20% to the global demand for physical gold
• Roughly 30% of gold jewellery fabrication is from recycled pieces
• India is typically also the largest purchaser of coins and bars for investment
• At just over one gramme of demand per thousand dollars of GDP, India stands third in the world, behind only the UAE and Bahrain.