Jewellers want post offices to introduce systematic gold deposit collection

IBJA has urged the govt to maintain the current limit level of Rs 200,000 for cash transaction as per mandatory PAN limit

Bullion dealers and jewellers have urged the government to allow the post offices to start gold accumulation scheme to facilitate rural depositors keep their affinity towards bullion intact with the systematic deposit of small sum on a continuous basis.

In a pre-Budget recommendation submitted to the Union Finance Minister, the apex industry body the India Bullion and Jewellers Association (IBJA) said, “Gold deposit scheme must be started through post offices across Indian wherein gold recurring deposit account is credited with gold quality when depositors deposit the money in such account. Such gold accumulation plan will help investors to systematically invest in gold over a period of time.”

Till recently, post offices were allowed to retail gold coins through their main branches across metros and semi-metros. But, the government’s efforts to reduce promotion of gold coins and bars restricted sales of gold coins through post offices. Not only post offices but also retail jewellers were asked to discourage sales of gold coins which had become a major investment avenue till last year.

IBJA representing hundreds of thousands of bullion dealers and jewellers across India has recommended to set up a bullion bank separately to deal exclusively with bullion import and jewellery exports. Apart from that, the bullion bank should maintain a gold account in “quantity” instead of “rupee” account. This will help the government to reduce import dependence on gold, said Surendra Mehta, National Secretary, IBJA.

Further, ruling out any possibility of reducing cash transaction, IBJA has urged the government to maintain the current limit level of Rs 200,000 for cash transaction as per mandatory permanent account number (PAN) limit. To promote exports of bullion and artefacts of precious metals thereof, jewellers have called on the need to set up a domestic gold council which the government has already set up for many other sectors. In order to bring the domestic jewellers and bullion dealers’ house in order, IBJA sought to set up a spot exchange and gold board, similar to that of Tea Board, Spices Board etc. to promote the welfare of entire value chain in this business.

In a pre-budget submission, another industry body representing organized jewellers All India Gems and Jewellery Trade Federation (GJF) highlighted the need to re-open mining on domestic gold mines. “Important mining destinations like the Kolar mines and other dormant mines to be reactivated and offered to private companies to explore the scope of mining. Mining of gold should be opened up for private players who have the know-how, means and capacity to invest in such mining operations. This will also ease imports and find permanent solutions for gold in India and give more job opportunities,” said Nitin Khandelwal, Chairman, GJF.