A bullion association in India is planning to launch the country’s first physical gold trading exchange, according to a report by Reuters.
It said the Mumbai-based India Bullion and Jewellers Association (IBJA), a group consisting of gold dealers, traders and jewellers, is talking with industry officials about launching the exchange next year in an attempt to bring transparency to the market.
India is the second-biggest consumer of gold after China.
A dedicated physical gold exchange could lead to standard gold pricing in India, and could also bring transparency to a market which can involve large cash transactions, Reuters said.
“We are planning to launch the exchange in six months,” it quoted Ketan Shroff, an IBJA spokesman, as saying.
The exchange, which will start with two to three delivery centres for gold and silver, will help the government to monitor gold trade, Shroff said.
India last month launched gold monetisation and sovereign bond schemes that are designed to mobilise the country’s gold hoard and reduce imports of the precious metal which are exacerbating the trade deficit.
A physical exchange is likely to mean jewellers, retailers, refiners and banks can trade over a regulated platform, Reuters said, adding that China had such an exchange where all domestic production and imported gold has to be bought and sold.