--- Hallmarking of gold jewellery can increase exports from $8 billion to $40 billion by 2020
--- Currently less than a third of Indian jewellery is hallmarked
--- Widespread differences in purity and an average under-caratage of 10-15 per cent.
Despite India’s long-standing affinity for gold, there is little in terms of quality standards and consumer protection for the buyers. Hallmarking of gold could emerge as a solution and it would not only increase the trust and confidence of the domestic consumer but also underpin the growth of gold jewellery exports under the ‘Make in India’ initiative.
A new report, ‘Developing Indian Hallmarking — A roadmap for future growth’ by World Gold Council (WGC), said that “the increased confidence in Indian gold, which a rigorous and consistent nationwide scheme would deliver, has the potential to increase the country’s gold jewellery exports from $8 billion to $40 billion by 2020 if adopted fully.’’
“Only around 30 per cent of Indian jewellery is hallmarked. Large jewellers have already embraced it but many jewellers do their own certification. Banks will not rely on that,’’ Somasundaram P. R., Managing Director, India, WGC, told this correspondent
Hallmarking standards were established by the Bureau of Indian Standards (BIS) in 2000 and there has been considerable improvement since. However, only 30 per cent of Indian gold jewellery is currently hallmarked and Mr. Somasundaram said there were widespread differences in purity and an average under-caratage of anywhere between 10-15 per cent.
Mr. Somasundaram said the procedure for hallmarking was not an expensive one and average Rs.250-300 per item. “As volumes pick up, price will drop.’’
India has around 400 hallmarking centres across the country but these are concentrated around some cities. Further, the report said the lack of BIS-recognised hallmarking centres across the country was likely to have an impact on the successful implementation of the government’s gold monetisation scheme which depends on the collateralisation of gold.
Experts believe there should be one hallmarking centre for every 20-30 jewellers, suggesting a national network of over 1,000 centres. “A typical hallmarking centre employs 7-10 people and cost Rs.60-80 lakhs to set up,’’ the WGC India MD said.
In the long term, the report said, hallmarking should be made mandatory.
“The development of a more stringent system would deliver huge benefits to the Indian gold market including increased trust amongst overseas buyers and financial markets, resulting in a larger export market, a strong domestic market and job creation across the spectrum,’’ he said.
