Gold prices are fixed internationally by the London Bullion Market Association (LBMA) and these are indicated to importers by banks and nominated agencies in India. Now industry body IBJA (formerly Bombay Bullion Association) wants to play a larger role and is tying up with CME Group, London for deriving a price mechanism similar to LBMA.
“Given our industry size, the industry should be able to derive its own price for gold in India and we should be in a position to dictate price to the world. It is a cause for concern and we too want to be able to have our own bullion price,” Mr. Mehta said. IBJA is awaiting approval from the regulatory authorities.
Further as part of its brand ‘IBJA’ promotion, it recently tendered for IBJA Gold Coin showrooms and intends to set up 100 in three years. The first of these, a 2,700 square foot showroom, will open in September 2015 in Mumbai. “We want to showcase 2,200 types of coins. We have plans for a couple of types of showroom — one would be 400 sq.ft. and the other around 2,000 sq.ft. In Tier 2 cities, we will have 300 types of coins.”
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IBJA wants to set up its own gold refinery and will move in that direction in the next few months. On the anvil are an e-portal, exhibition centres and jewellery showrooms.
IBJA also has plans for a World Silver Council. India is among the top five silver markets in the world but silver remains a highly unorganized industry suffering from a lack of standardization and certification. India’s silverware consumption trebled between 2012 and 2014 to 1,222 tonnes.
“Silver market is growing very fast but there is a need for standardization and certification. We have already got permissions but it will take some time to set up,” Mr. Mehta said.
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