FICCI says India Needs a Special Gold Policy | Fusion - WeRIndia

FICCI says India Needs a Special Gold Policy

FICCI Says India Needs A Special Gold Policy

The Federation of Indian Chambers of Commerce and Industry (FICCI) and the World Gold Council released a report on gold policy of India on December 9, 2014 and proposed certain recommendations on monetization of household gold.

In this report, they stated that India needs a special gold policy which is effective to improve the supply and demand analysis, and price standardization. India is at the centre of the global gold eco-system. Hence it is crucial to monetize the 22,000 tonnnes of Indian household gold for the economic growth.

The proposed recommendations are as follows:

  • Establishing an India Gold Exchange to facilitate standardization of gold prices and to improve transparency, supply and demand analysis.
  • Setting up a Gold Board for effective functioning of Indian gold market, managing imports and boosting exports of gold.
  • Indian banks are to be allowed to use gold in their liquidity reserves which helps them to launch gold-based saving products.
  • Monetization of gold is essential for active use of idle household gold assets which can be done by incentivizing banks through Gold Deposit Schemes and other gold-backed investments.
  • Accredited refineries are to be developed to be compatible with international standards. This includes the upscaling of present domestic refineries also.
  • Initiation of standardization of gold improves faith in both buyers and sellers on the quality and price of the gold. This improves transparency as well.
  • A dynamic marketing strategy is to be created to enhance the exports of Indian handcrafted jewelry. It also helps to create a brand value for ‘India-made jewelry’.

Image Credit: Richter Frank-Jurgen / CC BY-SA 2.0

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