Mandatory hallmarking of gold jewellery to protect consumers

Indian jewellery industry is on the cusp of complete transformation with the Government making hallmarking of gold ornaments mandatory and the move is expected to bring better consumer protection, officials from the sector said today.

While the mandatory hallmarking guidelines were approved by the Government in 2000, their effective implementation was deferred until now.

As the Government mulls action against retailers who sell gold ornaments without hallmarking, organised retailers, with nearly 30 per cent of market share, hoped this will prevent selling of non-hallmarked jewellery.

Most of organised retailers have already created their own brands and hence, they would not get affected.
 

"The number of hallmarking centres is adequate to meet the requirement of mandatory hallmarking. With the Government making hallmarking of gold ornaments mandatory, it is expected to bring better consumer protection," Indian Association of Hallmarking Centres Vice-President James Jose said in a statement here.

Jewellers with lack of infrastructure, however, would run out of business. Lakhs of family-run individual jewellers, mostly in villages or mini towns, serving small segment of their clientele base for generations, would also get impacted with the mandatory hallmarking of gold jewellery, he said.

For setting up a hallmarking centre, a capital investment of Rs 1 crore is required. Over and above, Rs 3,00,000 income is needed monthly for survival.

Considering Rs 25 per piece of hallmarking charge, irrespective of size and gold content, at least 12,000 pieces of hallmarking requirement is there for break even. The association says 350 hallmarking centres are enough to tackle mandatory hallmarking.

The rules and guidelines of the gold hallmarking have been changed to ensure better monitoring of quality, especially in a mandatory hallmarking regime, where every piece of jewellery sold in the country shall carry the 5 BIS (Bureau of Indian Standards) hallmark logos. Most of the problem areas of the present scheme are adequately amended to make it consumer friendly, the statement said.

All hallmarking centres in the country are reporting their monthly business volumes to the BIS. Records indicate in 2015-16, around 370 lakhs of jewellery articles, weighing around 500 tonnes, were hallmarked at the 375 BIS recognised centres in the country.