Gold jewellery exports could jump five times to $40 billion per year by 2020 if quality controls are tightened, the World Gold Council (WGC) said, adding the country is punching below its weight due to questions over the purity of its products.
Mom-and-pop shops employing generational craftsmen dominate the 400,000 jeweller-strong industry in the world’s largest gold consumer. Most of them have yet to adopt standards launched in 2000 due to a shortage of hallmarking centres and added costs.
The Bureau of Indian Standards is aware of the issue and is looking to address it, said WGC’s India head, Somasundaram PR. He also urged the government to incentivise opening of more centres and to eventually make standardisation mandatory.
“Hallmarking is to jewellery what ‘know your customer’ norms are for financial services,” Somasundaram said. “It is essential to the success of the jewellery industry in a world where consumers seek transparency, quality and consistency.”
India’s overseas sales of jewellery are just 8 per cent of the global gold market as buyers in places such as the Middle East, where hallmarking is stringent, do not trust the purity or quality of Indian exports, he said.
India’s gold imports, however, are 20-25 per cent of the demand in the world. Its gold consumption oscillates between 800 tonnes and 1,000 tonnes.
Organised Indian jewellers like Titan Company’s Tanishq and Rajesh Exports, the world’s largest gold jewellery maker and a top exporter, have been leading campaigns to persuade consumers to upgrade to standardised products.
Rajesh Exports this month bought Swiss company Valcambi, the world’s largest gold refiner, for $400 million in a deal that could further boost its image globally.