In times of crisis, nothing glitters quite like gold.
Investors worldwide have flocked to this time-tested hedge against recession, inflation and stock market fluctuations in recent months.
In India - the world's largest consumer of the precious metal - the demand is unparalleled. Despite soaring prices, the buying of gold has jumped nearly 40 per cent in the past three months.
Imports are expected to cross the psychological 1,000-tonne mark this year, up from 950 tonnes last year, according to the World Gold Council.
But India's fetish for gold threatens to take the shine off its fast-paced economic growth.
Many economists worry that financial markets are losing out on funds that have instead been spent on gold.
About 18,000 tonnes of the metal, worth more than US$800 billion (Dh2.93 trillion)- almost double the gold reserves maintained by the US Federal Reserve - sit idle in family vaults as ornaments, bars and coins, according to the global consultant McKinsey& Co.
Y Venugopal Reddy, a former governor of the Reserve Bank of India, says this has created an incurable "drain on savings", threatening to hobble economic progress.
As gold becomes an ever-more popular investment, India's household savings rate plummeted in the financial year that ended on March 31 to 9.7 per cent of GDP, compared with 12.1 per cent in the previous fiscal year.
If India's gold buyers were to pour their annual savings into other investment instruments, such as shares, mutual funds or property, the country's yearly GDP would be higher by 0.4 per cent, says Chetan Ahya, an economist with the investment bank Morgan Stanley.
"Our analysis based on the stake holdings trend of around 1,200 National Stock Exchange-listed companies and purchases of mutual funds indicate that Indian households' allocation to equity has fallen sharply following the credit crisis. On the other hand, their investment in gold has been trending upwards," he wrote in a research paper.
"The cumulative GDP value lost by parking $800bn worth of savings over the years in this not so productive asset [gold] would be huge."
Mr Ahya also warned that rising imports to meet the growing demand for the metal were resulting in the "inappropriate use" of foreign-exchange earnings.
He estimates that gold imports, the second-biggest after crude oil, accounted for 2.1 per cent of GDP and 13 per cent of total non-oil imports in the year to March 31.
The tendency of citizens to hoard the metal reflects a deeply engrained cultural neurosis that cuts across social classes.
Because of low banking penetration in rural India, home to two-thirds of the population, people often prefer to convert their savings into gold as an insurance against inflation. Affluent Indians also attach a sentimental value to the yellow metal. Brides are often customarily weighed down in gold ornaments.
It is presented as gifts when a baby is born, and many consider it a good omen to splurge on gold during Hindu festivals such as Diwali and Dhanteras.
The amount of gold used in making jewellery last year rose 36 per cent to 685 tonnes. Tanishq, a leading jewellery store chain offering a collection of diamond and 18 and 20-carat gold sets, expects a double-digit jump in sales for this fiscal year ending on March 31 next year. With growing sales, Tanishq says its sales turnover in the year is expected to top 70bn rupees (Dh5.4bn) , up from 55bn rupees last year.
The brand operates 127 stores across 76 Indian cities, and plans to add 15 to 20 more by the end of the year, says CK Venkataraman, Tanishq's chief operating officer, who attributed growing sales to growing "investor insecurities".
Until a generation ago, a large number of Indians baulked at the idea of monetising their gold ornaments. But as the price of the metal has climbed to new highs, they are fast relinquishing age-old taboos about using gold as collateral for loans or as an alternate currency to augment income.
Domestic gold prices have climbed 33 per cent this year.
With the central bank raising interest rates 12 times since March last year to combat near double-digit inflation, domestic deposits and fixed-income investments look increasingly vulnerable.
The Bombay Stock Exchange benchmark Sensex, meanwhile, has fallen more than 16 per cent since the start of this year.
By contrast, investment demand in gold rose 78 per cent in the past three months from a year earlier to 108.5 million tonnes, according to the World Gold Council.
Funds that invest in gold have been outperforming most other investment instruments, with exchange traded funds - or "paper gold" - offering returns of 15.2 per cent to investors last month, according to data compiled by Thomson Reuters.
India's total of gold exchange traded funds investment has reached 15 tonnes this year, and is expected to double in a year.
But analysts warn gold is not a guaranteed safe investment. Last month, prices suddenly fell 5.6 per cent - the sharpest monthly drop since March 2008.
"Gold's extraordinary volatility has evoked extraordinary fear, greed and confusion," The Economic Times, a national business daily, declared in an editorial. "Bulls have forgotten trees don't grow till heaven."