India’s uneasy relationship with gold has returned to the policy centre stage. Amid pressure on rupee and forex reserves, India has raised gold and silver duties and tightened import norms after Prime Minister Narendra Modi urged citizens to postpone non-essential gold purchases. This is the backdrop in which Electronic Gold Receipts, or EGRs, deserve a fresh look. Coincidentally, the NSE earlier this month launched EGR trading, giving it a potentially wider exchange, broker and investor network.Indians love gold and the country’s gold import bill crossed $70 billion in FY26 alone. The World Gold Council has estimated India’s household gold stock at up to 25,000 tonnes, much of it sitting outside the formal financial system. At their core, EGRs try to move part of gold ownership and bullion trading from an opaque, fragmented physical market into a regulated, demat-based, exchange-traded system. Here is a lowdown.BasicsAn EGR is an electronic receipt issued against eligible physical gold deposited with a SEBI-registered vault manager and held in demat form. EGRs are also permitted to be pledged or hypothecated, subject to the applicable depository and intermediary process.For practical purposes, EGRs can be approached in two ways. First, by someone who already holds eligible physical gold, typically bars. This gold has to be deposited with a SEBI-registered vault manager and validated against prescribed purity, denomination and good-delivery norms. Once accepted, equivalent EGRs are credited to the person’s demat account. These can then be held or sold on the exchange. If the holder later wants physical gold, the EGRs can be extinguished and gold can be withdrawn. Note, ordinary household jewellery, even if made of gold, cannot be deposited as-is for EGR creation.