17 Indian Funds Suspend New Subscriptions in Gold Ahead of Holidays

Seventeen Indian fund companies issued notices on Thursday evening, October 15, 2026, suspending fresh capital inflows into gold products ahead of the buying season associated with the Dussehra and Diwali festivals. Reuters was the first to report the move regarding gold exchange-traded funds (ETFs).

Two types of products were affected. In gold ETFs, institutions including HDFC, Kotak Mahindra, and UTI halted large subscriptions without citing a reason. As for gold fund of funds, Kotak, Tata, and ICICI Prudential suspended, effective October 16, new lump-sum amounts, transfer-ins, and new systematic investment plan (SIP) registrations. The Creso platform reported that HDFC, Aditya Birla Sun Life, DSP, and Invesco issued similar notices.

Existing holdings remain unaffected, as investors can continue to redeem gold fund units, and existing investment plans will continue based on the prevailing Net Asset Value (NAV). The companies did not disclose the reason for the decision, while Reuters quoted a fund official as saying the move followed discussions with the Securities and Exchange Board of India (SEBI), without official confirmation from the regulator or the government.

This comes amid pressure on the rupee due to rising oil prices and foreign investors selling Indian equities, which raised the import bill. India is the world's second-largest consumer of gold, importing most of what it consumes and paying for it in US dollars, thereby widening the trade deficit. Gold imports fell to $1.8 billion in September from $2.3 billion in August.

What Do These Terms Mean?

Exchange-Traded Fund (ETF): An investment fund traded on a stock exchange that tracks the price of a specific asset, such as gold. Gold ETFs are backed by physical gold, so fresh capital inflows may require purchasing more of the metal.

Indian Rupee: The official currency of India; its depreciation against the US dollar makes dollar-denominated imports more expensive and drives up inflation.

Trade Deficit: The difference between the value of a country's imports and exports, which widens when imports grow faster than exports.

Systematic Investment Plan (SIP): A facility through which an investor regularly invests a fixed amount into a specific fund instead of depositing a lump sum all at once.