Although the hallmarking for yellow metal is been made mandatory by the Indian government, it will take at least a year for it to be implemented across the country
The Indian ministry of consumer affairs recently approved a proposal making hallmarking of gold, mandatory. The industry has welcomed the decision however sources within the ministry say that it will be at least 12 months before it can be implemented across the county.
Consumer activists have also expressed their reservations on the process of hallmarking of gold in India. AR Shenoy, a Mumbai-based consumer activist, said, “The concept of hallmarking is good. But the implementation is a big issue. The Bureau of Indian Standards (BIS) does not have required infrastructure for gold testing. At times it is outsourced to the third party.”
“There are cases in the market where gold which is not 916 gold or 22 carat, is being Hallmarked as pure or 24 carat. I knew an agent who shut down his business of Hallmarking gold because he was pressurised by jewellers and pertinently asked to give 916 gold certifications to the yellow metal which was of lesser purity,” Mr Shenoy added.
The union cabinet cleared the proposal by approving amendments to the BIS Act, 1986, that aims to expand the ambit of mandatory Hallmarking to include more products, including gold. Currently, Hallmarking of gold, giving it a purity certificate, is not mandatory. The BIS, under the ministry is the administrative authority of Hallmarking.
According to reliable sources from the ministry, though the hallmarking for yellow metal is been made mandatory, it will take at least a year to see the results on the ground.
Players from the gold jewellery industry have welcomed this move. Karan Vasa, associate vice president, RiddiSiddhi Bullions Ltd, says, “Given the prices of gold, which are skyrocketing, Hallmarking would provide a cushion of assurance to the customers. From the re-selling point of view, Hallmarking is a great move. In future, if customers want to re-sell their Hallamarked gold jewellery, it will become easier.”
When asked about the implementation among the widely spread gold jewellery stores and makers in the local market, Mr Vasa explained, “Given the size of our country, it will take time for proper implementation. For this, there should be awareness among the consumers who would then demand hallmarked gold from their jewellers.”
Rajesh Export Ltd, a leading gold jewellery manufacturer while welcoming the move said, “The major challenge would be for the government to implement the law and enforce strict punishment and deterrents for jewellers violating the law by selling jewellery without Hallmark or with spurious Hallmark.”
Muthoot Finance Ltd, country’s largest gold company says this move will bring in more transparency. “We as a gold loan company would benefit out of the increased demand for gold in this country post BIS mark made it compulsory since the quality of gold ornaments being pledged by customer for their loans would be much better,” says George Alexander Muthoot, managing director, Muthoot Finance, in a release.
At present, about 77 items, including cement, mineral water and milk products, are certified through mandatory Hallmarking under the BIS Act for conformity with expected quality levels. The BIS Hallmark, a mark of conformity widely accepted by the consumer, bestows the additional confidence to the consumer on the quality of products like gold jewellery.
The development will help domestic companies to raise funds from overseas markets at better rates. The latest upgrade comes less than a month after Moody’s had upgraded the credit rating of Indian government’s bonds from speculative to investment grade
New Delhi: Global agency Moody’s today upgraded India’s short-term foreign currency rating from speculative to investment grade, a development which will help domestic companies to raise funds from overseas markets at better rates, reports PTI.
“... there has been another upgrade by Moody’s with the short-term country ceiling on foreign currency bank deposit increasing from NP (not prime) to Prime (P-3), suggesting acceptable ability to repay short-term obligations,” the finance ministry said.
The ‘P-3’ ratings suggest acceptable ability to repay short-term obligations.
The latest upgrade comes less than a month after Moody’s had upgraded the credit rating of Indian government’s bonds from speculative to investment grade, a move that was expected to encourage FIIs to increase their exposure in gilts and help companies raise funds from abroad at competitive rates.
On 20th December last year, Moody’s had upgraded short term government bonds denominated in domestic currency from NP to P-3.
Moody’s had upgraded rating on long-term government bond denominated in domestic currency from Ba1 to Baa3 or from speculative to investment grade.
Besides, the long-term country ceiling on the foreign currency bank deposit was also upgraded from Ba1 to Baa3.
Giving a rationale for the upgrade in December, Moody’s had at that time said, “Diverse sources of Indian growth have enhanced its resilience to global shocks”.
It had added the present slowdown “could reverse sometime in 2012-13, as inflation cools from current 9% levels”.
The finance ministry had approached the ratings agency seeking clarification regarding the ‘short-term country ceiling on foreign currency bank deposit’, which had not found mention in the earlier decision by Moody’s.
According to the ministry, the ratings firm has sent it a mail affirming an upgrade in that front as well.
“The Department of Economic Affairs (DEA) will continue to engage rating agencies on regular basis to impress upon them the long-term structural strengths and sound fundamentals of the Indian economy,” joint secretary in the capital markets division of the DEA Thomas Mathew said.
Presently, six sovereign ratings agencies—Standard & Poor’s, Moody’s, DBRS, Fitch, Japanese Credit Rating Agency and the Rating and Investment Information Inc—assigns ratings to India.
"I am happy to inform you that the government has decided to introduce and sponsor a new pension and life insurance fund for overseas Indian workers,” prime minister Manmohan Singh said
Fulfilling a long-standing demand, prime minister Manmohan Singh announced a new pension and life insurance scheme for overseas Indian workers that would allow over five million workers, especially those working in the Gulf, to save money for the future.
Announcing the government's decision to introduce and sponsor the Pension and Life Insurance Fund (PLIF) at the 10th Pravasi Bharatiya Divas, Mr Singh said the scheme will encourage the overseas workers to voluntarily save money for their resettlement and old age.
“I am happy to inform you that the government has decided to introduce and sponsor a new Pension and Life Insurance Fund for overseas Indian workers.”
“The scheme will encourage, enable and assist overseas workers to voluntarily save for their return and resettlement and old age," Mr Singh said in his address that was heard with rapt attention by over 1,900 delegates from 60 countries.”
Mr Singh said the scheme, which was recently cleared by the Cabinet, will also provide a low-cost life insurance cover against natural death.
“This scheme fulfils a long-pending demand of our workers abroad,” he said. Under the scheme, the government will co-contribute Rs1,000 per annum for all subscribers who contribute between Rs1,000 and Rs12,000 per year. Women overseas workers will enjoy a special additional co-contribution of Rs1,000 a year.
Referring to his government's decision to allow non-resident Indians to vote in elections, he said pursuant to the law in this regard the government has issued notifications for registration of overseas Indians under the Representation of People Act, 1950.
Mr Singh said, “This constitutes the first major step to enable Indians resident abroad to participate in our election processes”. In its efforts to merge the People of Indian Origin and Overseas Citizen of India schemes, Mr Singh said the government introduced a Bill in this regard by amending the Citizenship Act in the just concluded Parliament session.
“This will rectify some of the anomalies in the schemes and provide for an Overseas Indian Card which will be given to foreign spouses of such card holders as well,” the Prime Minister said. He noted that the ministry of overseas Indian affairs was implementing the e-migrate project to provide end-to-end computerised solutions for all processes in the emigration system.
The system will link all key stakeholders on a common platform which will be used by workers, offices of the protector of emigrants, recruitment agencies, immigration officials, employers and the Indian missions abroad, he said.
Mr Singh also said the government was expanding the scope of the Labour Mobility Partnership Agreements is being expanded to cover not only skilled workers but also students, academics and professionals.
Such Human Resource Mobility Partnership agreements are being negotiated with The Netherlands, France, Australia and the European Union.