Govt should regulate bullion trade to ensure transparency

The bullion market needs transparency, especially about the source of funds and quality of goods, because really big money is involved

- G. Chandrashekhar is senior editor, policy commentator and commodity markets specialist. Views are personal.

At a time when the country faces a chronic goods trade deficit (crude oil, precious stones, metals, electrical and electronic equipment, edible oil, pulses, coal, fertilisers and many more items) and rapid depreciation of the rupee, resulting in import-led inflation, gold stands out as a highperformance commodity.

Bullion trade is big ticket. From a recent low of $22 Bn in 2020, the value of India's gold import has surged. 2021 saw a 150% rebound to $55.8 Bn. After dipping to $36.6 Bn in 2022, imports zoomed again to $42.6 Bn in 2023 and then on to a new high of $58.1 Bn in 2024.

The government lists as many as 26 countries as 'countries of consignment' for import and a few more bunched under the 'others' category. Remember: for gold import, it is not 'country of origin' but 'country of consignment'. Switzerland, the UAE, South Africa, Peru and Australia occupy the top five slots in terms of value, followed by the USA, Hong Kong and several African and South American nations.