Quote on Union Budget Setting up Spot Exchange for Gold in India By Prathamesh Mallya, Angel Broking
Below are Quote on Union Budget Setting up Spot Exchange for Gold in India By Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd.
The India Gold Policy Center (IGPC) at Indian Institute of Management, Ahmedabad, in August 2019 submitted a report recommending a gold spot exchange in the country. An exchange, encompassing the entire ecosystem of trading and physical delivery and located in or close to an SEZ, could reform and transform the gold market in India, IGPC said.
Keeping the hopes of gold market participants and the industry suggestions, the budget 2021-22 has announced, setting up of a spot gold exchange in which SEBI will be notified as the regulator and Warehousing Development and Regulatory Authority will be strengthened to set up a commodity market eco system arrangement including vaulting, assaying, logistics etc in addition to warehousing.
Setting up a spot gold exchange has two advantages, regulatory regime that provides global credibility and sufficient exemptions from capital controls to make global contract feasible.
To bring the import duty to previous levels, budget talked about rationalizing import duty on gold and silver. Gold and silver presently attract a basic customs duty of 12.5%. Since the duty was raised from 10% in July 2019, prices of precious metals have risen sharply. Import duty on gold and silver to be reduced to 7.5 percent from the current 12.5 percent.
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