India is poised to transition from a price-taker to a price-maker in the global gold market, with domestic mining expected to meet approximately 20 per cent of the country’s demand over the next decade, industry leaders said on Friday.
Speaking at a gems and jewellery conference organised by the Chamber of Commerce of India (CCI), Sachin Jain, Regional CEO for India at the World Gold Council, said mining would be a critical component as the country moves towards Viksit Bharat 2047.
“Over the next decade about 20 per cent of the demand of gold will be furnished by our own gold mined in India. There will be a sense about Indian gold, employment, and foreign investment coming to the mining sector,” Jain said.
He said India currently remains a price-taker due to the absence of significant domestic mining and a gold banking system, which makes it dependent on London’s AM and PM benchmark prices.
“With RBI and the evolution around the banking system, we will have influence on being a price-maker as well. Transparency and responsibility will not be optional but will be the basis of the system,” he added.
Jain also expressed confidence that India would emerge as a global jewellery hub within the next two to three years.
Sandeep Kohli, CEO of Novel Jewels, Aditya Birla Group, highlighted that Indian consumers hold 25,000 tonnes of gold compared to the government’s 800 tonnes — a ratio of 50:1.
In contrast, the Swiss government holds 1,000 tonnes while consumers hold 200 tonnes, he said.
“What I find absolutely astonishing is that consumer demand in India is not defining the price consumers pay, despite being amongst the largest consumers of gold,” Kohli said at the conference.
He described gold as India’s oldest asset class and the only one owned by “100 per cent of all Indians in some way or the other”, with deep cultural and emotional roots.
However, Kohli pointed to lack of transparency as a major issue, saying the buying experience of gold jewellery is “filled with anxiety” unlike other expensive purchases such as cars or mobile phones where online comparisons are easily available.
“How can we remove that anxiety? That comes not only with trust, but also by celebrating what they are buying. I don’t think we are doing that enough,” he said.
Samit Guha, Managing Director and CEO of MMTC PAMP India Pvt Ltd, emphasised the need for enhanced transparency and ethical sourcing standards to compete globally.
“If you were to be a global player which will allow you to set prices, you essentially have to get into areas of transparency about the entire marketing and sourcing process,” Guha said.
While praising the Bureau of Indian Standards’ hallmarking and HUID-based tracking system, he called for adoption of OECD and LBMA guidelines or establishment of equivalent Indian standards.
“The world is now moving to ethical sourcing, conflict-free sourcing of gold. Unless we can up our game and move to that level, it will be difficult for us to participate in the global economy,” he said.
Guha also flagged regulatory barriers, noting that India is still not allowed to export 24-carat bullion, a restriction imposed by the RBI around 2012-13.
“There is a need to revisit it if we were really to supply Indian bullion in global exchanges. Otherwise, we will continue to be restricted with what we can do on the MCX and IIBX,” he added.
