India's gold collection under exchange-traded funds rose 32.8 percent to 5.172 tonnes in the year to February-end, when domestic gold touched a record high, data from the funds showed.
"Increased awareness is driving this growth," said Rajan Mehta, executive director with Benchmark Asset Management.
Gold futures on the continuation chart MAUc1 struck an all-time high of 16,040 rupees per 10 grams on Feb. 20 as investors sought shelter from the financial blizzard in the safe haven asset, and was further supported by a weak rupee.
A weak rupee makes the dollar-denominated yellow metal expensive.
"We haven't seen much buying happening after that due to higher prices," said Mehta, adding "there is also profit-taking seen."
Though gold collections under ETFs are growing, they remain miniscule against India's imports of about 700 tonnes annually.
Gold ETFs -- instruments that can be traded like shares and are backed by physical gold holdings -- are more than a year old and the segment may get crowded with some other funds planning to enter.
The following table shows ETFs' gold holdings in metric tonnes and their value in billion rupees:
