200 ton gold demand to be served by grey market this fiscal; Monsoon to affect gold demand: WGC India MD
The Bureau of Indian Standards (BIS) is working to give a unique ID to each piece of hallmarked jewellery that is sold through registered jewellers and BIS recognised hallmarking centres, its director general, Mr Sunil Soni informed at an The Associated Chambers of Commerce and Industry of India (ASSOCHAM) event.We want to give unique ID/number for each hallmarked item and the same number will be there for number of pieces, this will help in curbing duplication and help in traceability i.e. in case you happen to buy one such piece you can hold someone responsible if it is found to be sub-standard, said Mr Soni.
We are now trying to work out with the associations of both hallmarking centres and jewellers to try to give a unique ID to each piece which is hallmarked and consumers will start getting an ATM size like a card while purchasing hallmarked jewellery which will be fully traceable even through mobile phone and the whole history could be checked, said Mr Soni.
There were some misapprehensions and opposition and we are trying to get those issues sorted out, he added.
There are over 13,000 licensed jewellers registered by the BIS and over 300 hallmarking centres recognised by BIS across India and sale of hallmarked gold jewellery in the country is growing at an annual rate of 25 per cent and had touched 2.6 crore pieces last year, thereby showcasing that despite being voluntary the demand for hallmarked jewellery in India is very high, further informed Mr Soni.
He also emphasised on the need to make the jewellery hallmarking system in India more reliable to improve the competitiveness of Indian industry and protect Indian consumers in a much better way.
BIS conducts market surveillance about whatever is sold to check the quality of hallmarking and in certain cases we find that we are not getting the standards which are required to be there and it is not as pure as it is declared to be and we take actions against those jewellers and hallmarking centres and we would like it to become more reliable, said Mr Soni.
Some further improvement is certainly possible in the system today as it is not 100% reliable and is not accepted internationally, he added. If the jewellery hallmarked as per Indian standards is accepted internationally then Indian jewellery could have much better credibility.
In his address at the ASSOCHAM Gold Summit, Mr Somasundaram P R, Managing Director (India), World Gold Council said, Of the total gold import demand of about 850-950 ton this financial year we believe that about 200 ton would be served by the grey market which was 974 tonnes last fiscal.
He added that though it is being expected that monsoon will come back to normal but with overall rural savings coming down, the 7-8 per cent of household savings that go to gold would impact its demand to that extent.
India holds around 22,000 tonnes of gold valued at over a trillion US dollars. A range of social, cultural and economic factors ensure that gold remains a preferred asset class across households regardless of supply restrictions, said Mr Somasundaram.
It is imperative therefore that we find ways of mobilising and monetising the household savings imbedded in gold stocks through the formal financial sector to support economic growth for the benefit of the economy as a whole, in a way that could unlock the potentially transformative value of the gold held in private hands across the nation, he said.
It is our hope that the short-term curbs on gold, understandable at the time they were introduced, but which have led to an increase in smuggling, will be reviewed and reversed soon. Discussions on gold in India should go beyond curbs and focus on how this industry can encompass an all-round growth, delivering enhanced economic contribution to all its stakeholders, he added.
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