Kochi: The central government’s Gold Monetisation Scheme (GMS) to monetise gold reserves in Indian households will benefit individuals and the economy if implemented pragmatically, an industry veteran has said.
“Indian households are expected to have 20,000 tonnes of gold, and to monetise one per cent of it would mean 200 tonnes,” James Jose, secretary of the Association of BIS Recognised Hallmarking Centres, has said. “This will be a big relief for the government which is trying hard to boost the foreign exchange reserves.”
The government must make the package attractive taking a cue from the failure of the package it had offered 10 years ago, Mr Jose said.
“Given that banks offer gold to jewelleries at six-to seven per cent interest, the banks can offer at least three per cent interest to the investors, unlike one per cent offered in the earlier plan. It will be a win-win situation for the jewellers also as they pay 12-14 per cent interest for their working capital.”
Mr Jose said the government should also bring down the minimum quantity of gold to be deposited from 500 grams to 50 grams to entice households with lesser quantity of gold reserves.
“It will also obviate production of source of income,” he pointed out. An amnesty for up to 250 grams will help attract more people to the scheme, he said.
He said the association has had about six meetings with the government on the topic. “We have suggested that the depositor should get information on the purity of gold in four hours and the process should be complete in seven days. This was 90 days in the previous scheme,” he said.
Kerala, which is expected to hold 15-20 per cent of the total gold reserves in the country is likely to lap up the scheme, he said. “The customers here are better informed than their counterparts in other parts of the country,” he pointed out.
Mr Jose, who is the managing director of Cochin Hallmarks Company, said his firm is setting up an integrated gold processing complex in Ernakulam, with all facilities for the gem and jewellery industry. “It will facilitate melting, purifying, hallmarking, coin minting and bullion trading,” he said.
