Larry Fink of Blackrock argues that India's gold obsession has not positively impacted its economy or attracted investors.

• Larry Fink, the founder and chairman of Blackrock, stated that India's preference for gold has not benefited its economy or provided substantial returns for individual investors.
• Gold holds significant cultural importance in India, making it one of the largest markets for the precious metal.
• India has consistently been one of the top consumers of gold globally, with its central bank holding an all-time high of 817 tons of gold reserves, according to data from the World Gold Council.

Larry Fink, the Founder and Chairman of Blackrock, stated in his annual letter to shareholders that India's love for gold has not helped its economy or provided good returns for investors.

Fink stated that during his visit to India in November, he encountered policymakers who expressed their disappointment over the citizens' preference for gold. Despite gold's underperformance compared to the Indian stock market, investing in gold has not contributed to the country's economic growth.

While gold can be a valuable asset, it does not contribute to economic growth as it does not have a multiplier effect like keeping money in a bank or investing in a house.

Gold holds significant cultural, religious, and financial importance in India, making it one of the largest markets for the precious metal. It is commonly bought during weddings and festivals, viewed as auspicious, and considered a safe investment and a symbol of wealth.

Purchasing gold can be done through various methods, such as buying jewelry, exchange-traded funds, and sovereign gold bond schemes.

Capital markets are crucial for a country's economic growth, as Fink pointed out, highlighting the significance of the U.S. capital markets in the American economy.

Capitalism is the only force that can lift more people from poverty and improve their quality of life. No other economic model can help us achieve our highest hopes for financial freedom, whether for ourselves or our country, as Fink stated.

India consistently ranks among the top countries in gold consumption globally, with the Reserve Bank of India purchasing 4.7 tons of gold in February, increasing its gold reserves to a record 817 tons, according to World Gold Council data.

Despite Kavita Chacko, research head of India at World Gold Council, stating that recent record highs in gold prices could negatively impact demand for the precious metal in India.

Gold and cash will be closely monitored during the country's upcoming general elections from April to June, which may not result in a significant increase in demand, even if prices moderate, according to Chacko.

Despite Indians' love for gold, the country's stock markets have experienced significant growth, with major institutional investors showing positive views on Indian stocks that have reached new highs several times in 2021.

— CNBC's Lee Ying Shan contributed to this story.