Indian Gold Book:Indian Gold Book - Gold Bars Worldwide

SUMMARY AND POSITIVE FINDINGS
To mark the difference between Indian and Western markets, the term “investment jewellery” is widely used by Western
analysts to describe gold jewellery sold in India.
Gold jewellery products
K22 is the dominant caratage.
The bangle is the most important product for most large retailers. It accounts, on average, for around 30% of their gold
jewellery sales. A pair typically weighs between 12 g and 24 g.
Gold jewellery is fabricated in a diverse range of regional styles. Kolkata, for example, is renowned for its intricate filigree
jewellery.
Jewellery fabricators
Around 85% of gold jewellery is handmade or mainly handmade. Around 15% is mainly machine-made, but its proportion
is increasing.
There are probably about 3 million active goldsmiths and ancillary workers. Many work in units with less than 5 workers.
A goldsmith typically has a capacity to fabricate 10 g of carat jewellery each day. Mumbai is now regarded by many as the
largest fabrication centre due to its high output of machine-made jewellery. Other major centres include Kolkata,
Ahmedabad/Rajkot, New Dehli and Coimbatore.
Units are under pressure from retailers and consumers to produce innovative and higher quality jewellery.
Traditional jewellery retailers
There are approximately 300,000 “traditional” gold jewellery outlets. They are family-owned businesses. Less than 15,000
family retailers may account for 30% or more of gold jewellery sales nationwide. Large showrooms are expected to increase
their share of the jewellery market. The distribution network is expected to contract gradually. Many large retailers mount
extensive advertising and promotional programmes.
Branded jewellery retail chains
Large national chains of branded jewellery retail outlets have emerged since the mid-1990s. The report covers 5 leading
national chains: Tanishq, Gili, Carbon, Inter Gold and Oyzterbay. Combined, they retail through 188 outlets in 49 cities. All
have plans to expand.
The retail chains focus on selling fashionable, lighter weight, studded jewellery as a “fashion accessory” at fixed prices.
Although they account for less than 1% of the jewellery market, they anticipate significant growth as the economy
develops.
Hallmarking
The Bureau of Indian Standards (BIS), the national standards body of India, launched its long-term scheme to encourage
the voluntary hallmarking of gold jewellery in April 2000.
Known as the BIS Certification Scheme for Hallmarking of Gold Jewellery, the scheme is supported by the Reserve Bank of
India.
It has 4 declared objectives: protect the consumer against irregular gold quality; support the export of gold jewellery;
develop gold-based financial products to assist in mobilising dormant gold reserves in private hands; develop India as a
reliable gold market centre commensurate with its status as the world’s largest national gold market.
By early 2002, 12 Assaying and Hallmarking Centres had been authorised to service 275 Certified Jewellers.
Gold jewellery exports
According to The Gem & Jewellery Export Promotion Council (GJEPC), around 800 enterprises fabricate plain or studded gold
jewellery for export.
Since 1990, the import of gold for re-export as jewellery has increased from 11 tonnes to 54 tonnes.
The jewellery export industry receives much government support through the GJEPC, which falls under the administrative
control of the Ministry of Commerce and Industry.
INDUSTRIAL GOLD USAGE
Since 1990, industrial gold usage has grown to an indicative 43 tonnes, due mainly to a surge in the use of
gold for plating purposes.
Gold plating (70%), Zari thread (14%) and ayurvedic medicines (12%) are the most important categories.
MUMBAI GOLD PRICES
Indian gold prices are normally expressed in rupees per 10 g at 995 purity, or per 10 tola at 999 purity.
For decades until 1996, the rupee gold price increased each year. For 4 years (1998 – 2001), after a decline of 12% in 1997,
it remained largely static.
AN INTRODUCTION TO THE INDIAN GOLD MARKET 17