Even as the gems and jewellery industry welcomed the government's decision to extend the compulsory hallmarking, jewellers feel it's not enough to liquidate the current stock and they need a minimum one-year time.
In view of the coronavirus pandemic, the government on Monday announced the extension of a deadline for mandatory hallmarking of gold jewellery and artefacts by over four months till June 1, 2021.
"We welcome this decision to give extension on mandatory hallmarking of gold jewellery and artefacts. However, we have been requesting for a one-year extension. Practically, there are no sales taking place and unless we sell, we cannot replace our stock with hallmark gold," All India Gem and Jewellery Domestic Council Chairman Anantha Padmanabhan told PTI.
He said the association, together with other jewellery bodies, will again make a representation to the government raising these concerns.
"By September we expect to replace 70-80 per cent of stocks with hallmark items. With sales going slow we need time, especially the small jewellers, of at least one year to replace all our stocks. We will approach the government again with a representation to extend the time in this regard to January 2022," he added.
Consumer Affairs Minister Ram Vilas Paswan on Monday told reporters that this decision was taken on the behest of jewellers, who had urged for extension.
"Jewellers had made a request to extend the time. We have extended the deadline from January 15 to June 1, 2021, in view of the disruption in the wake of the COVID-19 crisis," Paswan said.
From June 1 next year, jewellers will be allowed to sell only 14, 18 and 22 carats of gold jewellery, the minister added.
At present, gold hallmarking is a purity certification of the precious metal and is voluntary in nature.
The Centre, in November last year, had announced that hallmarking of gold jewellery and artefacts would be made mandatory across the country from January 15, 2021.
The Bureau of Indian Standards (BIS) is already running a hallmarking scheme for gold jewellery since April 2000, and around 40 per cent of gold jewellery is being hallmarked currently. So far, 28,849 jewellers have been registered with the BIS.
World Gold Council (WGC) Managing Director (India) Somasundaram PR opined that the extension of time by six months for mandatory hallmarking reflects a pragmatic approach by the government to support the industry in the current environment while keeping the path of reform intact.
"Soon after the announcement early this year making hallmarking mandatory and giving a transition time of one year for manufacturers and jewellers to adapt to new logistics and dispose of non-hallmarked inventories, pandemic struck causing unprecedented business disruption,” he said.
Demand has slumped and therefore, the transition time has to be stretched to enable industry to embrace this change, he added.
"However, many organised players have been selling hallmarked jewellery for years and so they may see accelerated growth in their market share as customers will be looking for trust underpinned by hallmarking when prices are at life-time high," Somasundaram said.
The industry needs to invest in collaborative efforts to ensure effective enforcement of this critical reform and successful transition within the extended period, he noted.
Welcoming the government's decision, PNG Jewellers managing director and CEO Saurabh Gadgil said the industry had been pitching for this aggressively.
However, the industry is not compliant with hallmarking and needs at least a year to have enough hallmarking centres across the country, he said.
"Moreover, the jewellers also need time to liquidate their stocks before replacing them with hallmark jewellery and items. We are hopeful that the government will consider our request in the current scenario," Gadgil added.