IGPC Puts Forward Proposals to Ramp Up Country's Gold Sector

SEATTLE (Scrap Monster): The India Gold Policy Centre (IGPC) at the Indian Institute of Management- Ahmadabad (IIM-A) and sponsored by the World Gold Council (WGC) has put forward two proposals, as part of efforts to ramp up the country’s gold sector.

Firstly, it recommends setting up of a Gold Board, which will be entrusted with multiple responsibilities including introduction of responsible sourcing guidelines and implementation of effective investor education campaigns. In addition, the proposed Board should act as an independent regulator which will oversee trading on spot gold exchange and bring about standardization in gold refining and vaulting requirements. IGPC noted.

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Secondly, IGPC recommends enhancement of existing banks, so as to transform them into bullion banks. It noted that setting up of a new bank altogether, as demanded by other industry participants, is not at all necessary. The divisions of the existing banks that deal with bullion purchases for customers should grow further to be able to perform all activities of a bullion bank. The bans should be allowed to source gold locally. In addition, the banks must be allowed to finance bullion and refining businesses.

The envisaged growth of banks to bullion banks will help in building market infrastructure and developing liquidity in the physical market.

The above mentioned proposals are likely to bring in radical changes to the way in which gold is currently dealt with in the country, noted IGPC.