Page 12 - Bullion World Issue 1 May 2021

Bullion World | Issue 01 | May 2021

into the value chain for collection of
deposits. The amendments also provide
for repayment of GML in physical gold,
including Indian Good delivery gold. All
the PSU banks participating in GMS are
now permitted to offer GML, which will
widen the reach of GML. Earlier, only
nominated banks authorized to import
gold could offer GML. The option of
drawing gold collected by Jewellers
under GMS for their own consumption
as a disbursement under GML, within
the authorized GML limits is under
examination. If implemented with
adequate safeguards, it has a potential to
eliminate processes like refining of gold,
transportation, and vaulting. That being
said, there are various components that
require tweak to make it a success.

Mining – The Mines and Minerals
(Development and Regulation)
Amendment (MMRDA) Bill, 2021, “ The option of drawing
passed recently on 22nd March 2021,
will help unleash India’s vast untapped gold collected by Jewellers
mining reserves. The bill can help under GMS for their
in unlocking 500 tons of estimated
gold reserves in India. It is however own consumption as a
debatable if the exploration was just disbursement under GML,
awaiting the parliament to pass the
bill or there are some other reasons, within the authorized GML
which needs to be examined. There limits is under examination. ”
is clarity required for the status of
deposits that were identified after getting
reconnaissance and exploration permits,
would those companies be willing to put
these on auction, how are they going to CONCLUSION
be remunerated? India has certainly taken some giant steps in the past 2 to 3 years towards reforming
bullion markets in India. The development of Gold spot exchanges will resolve the
issue of lack of Institutional participation which in itself will resolve various other
issue such as unorganized trade, lack of products, transparency, standardization
and recycling. Then there are specific reforms targeted towards specific issues.
Indirect reforms like focus on developing a digital economy, welfare schemes for the
rural population, financial inclusion are all the recipes of developing an unorganized
market. India’s reform process in the bullion industry has been consultative where
inputs from the stakeholders are taken before a reform is rolled out. It causes delay
at times, however, ensures least disruptions when implemented. As it is often said, a
reform is only as good as its implementation. That is one area we feel, more efforts
would be required to take the maximum benefit of all the good work done.

Harish Chopra
Harish Chopra is currently a Senior Policy Consultant in India Gold Policy Centre at the
Indian Institute of Management, Ahmedabad (IGPC@IIMA). Harish has a total work
experience of 29 years that includes 21 years in banking and financial services in the
bullion banking and retail banking space. Prior to his appointment at the IGPC@IIMA,
he was working with The Bank of Nova Scotia, a leading international bullion bank,
completing over 15 years in 2 tenures. Besides, he handled senior roles heading
finance functions at leading Indian Corporates, including Chief Financial Officer with
listed hospitality chain.

Harish is a 1992 batch Chartered Accountant and has also received Certification in
Treasury & Forex Management from the Institute of Chartered Financial Analysts of
India (in collaboration with the Institute of Certified Treasury Managers, US) in the
year 2002. Harish is an avid follower of developments in the bullion markets. His
other areas of specialization include Business Strategy & Management, Accounting
& Taxation and Risk Management. Harish has run Delhi Half Marathon for the past
3 years. In his spare time, he enjoys listening to music or getting behind a camera
clicking wildlife and nature.
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