 "To promote GMS, BIS invites jewellers to act as testing centres")
The Bureau of Indian Standards (BIS) has sought an Expression of Interest (EoI) from the 13,000 jewellers registered with it for acting as testing centres for the central government's recently announced gold monetisation scheme (GMS).
This is a bid to counter the lacklustre response till date to the scheme, attributed partly to the lack of testing centres and customers not wishing to take the risk of carrying their stock to faraway places for this purpose. In the GMS, gold needs to be melted and tested before arriving at a price. Therefore, a testing centre within accessible limits is key.
There were objections on involving jewellers but the government has decided to proceed, and relax the criteria for setting up testing and purity centres — to collect gold, conduct purity tests, melt it and send the gold to a refinery. As jewellers enjoy customer trust, the government decided it didn't have a problem if these became testing centres, signing a tripartite agreement with banks and refineries under the GMS.
The government of Turkey successfully monetised 200 tonnes of gold in the past two years and India could achieve the same success, he added.
The government says it is mulling other ways to push the scheme. J K Dadoo, additional secretary in the commerce ministry, suggested at the 3rd India International Bullion Summit here on Tuesday that, “the government should send its officials to temples and convince them to participate in GMS. A large quantity of 22,000 tonnes of gold worth $1 trillion is lying in India, of which 90 per cent is with temples and religious places. Interestingly, 50 per cent of the overall quantity of gold holding across the country lies with the top 100 religious places and trusts.”
If these efforts succeed, “the markets will be flooded with gold,” he added.
O P Bhatt, former chairman of State Bank of India, has suggested the government raise the eight to 10 years period for its gold bonds to 10-15 years. The initial response to the recently concluded first tranche of these sovereign gold bonds was a success, with applications from 63,000 investors and subscription for 917 kg of gold worth Rs 246 crore, between November 5 and 20.
This is a bid to counter the lacklustre response till date to the scheme, attributed partly to the lack of testing centres and customers not wishing to take the risk of carrying their stock to faraway places for this purpose. In the GMS, gold needs to be melted and tested before arriving at a price. Therefore, a testing centre within accessible limits is key.
There were objections on involving jewellers but the government has decided to proceed, and relax the criteria for setting up testing and purity centres — to collect gold, conduct purity tests, melt it and send the gold to a refinery. As jewellers enjoy customer trust, the government decided it didn't have a problem if these became testing centres, signing a tripartite agreement with banks and refineries under the GMS.
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“There are limitations in terms of testing facilities. But, since renowned jewellers are spread throughout the country, we would like them to come forward and serve the industry as testing centres, to make GMS a success,” said Shaktikanta Das, secretary, department of economic affairs. “The whole objective of the government is to reduce gold's import (1,000 tonnes last year) through local availability. Once we (government and industry) come together, GMS will be a great success.”
The government of Turkey successfully monetised 200 tonnes of gold in the past two years and India could achieve the same success, he added.
The government says it is mulling other ways to push the scheme. J K Dadoo, additional secretary in the commerce ministry, suggested at the 3rd India International Bullion Summit here on Tuesday that, “the government should send its officials to temples and convince them to participate in GMS. A large quantity of 22,000 tonnes of gold worth $1 trillion is lying in India, of which 90 per cent is with temples and religious places. Interestingly, 50 per cent of the overall quantity of gold holding across the country lies with the top 100 religious places and trusts.”
If these efforts succeed, “the markets will be flooded with gold,” he added.
O P Bhatt, former chairman of State Bank of India, has suggested the government raise the eight to 10 years period for its gold bonds to 10-15 years. The initial response to the recently concluded first tranche of these sovereign gold bonds was a success, with applications from 63,000 investors and subscription for 917 kg of gold worth Rs 246 crore, between November 5 and 20.