With the establishment of the India International Bullion Exchange (IIBX) near Gandhinagar, Gujarat, the price of gold sold in India will now be fixed within the country. Because India is the world's second largest gold consumer, Prime Minister Narendra Modi's introduction will now determine the direction of gold prices at the international level.
Currently, gold is sold in the bullion market at the London Bullion Market Association's set price.
India will serve as a gold import gateway.
Currently, gold is sold in India's bullion market at the price set by the London Bullion Market Association (LBMA). With the launch of IIBX in Gujarat International Finance Tec City (GIFT), gold prices in India will no longer fluctuate due to international speculators. The IIBX will serve as a gateway for gold imports into India.
The government intends to elevate this exchange to the level of the Shanghai Gold Exchange and Istanbul's Borsa Gold Exchange. Another significant benefit will be that Indian jewellers and exporters will not have to wait for the London Bullion Market Association to set the price of gold.
Currently, jewellery exporters and large domestic jewellers cannot import gold directly. They must import gold through a bank and an authorised agency. The bank charges both the gold exporter and the importer for this import. This type of fee is now exempt. Registered IIBX jewellers will be able to purchase gold directly from the seller. The price of gold will fall as a result of this.
The London Exchange opens gold rates per ounce. Then there's the gold import duty and a bank fee of about $2 per ounce. The bank charges this fee in the name of currency conversion and other service fees. -Pankaj Parikh, Exporter of Gems and Jewelery
We currently rely entirely on the bank for gold supply. This issue is now resolved. Jewelers can buy gold directly from international sellers by joining the exchange. -Rajeev Jain, Exporter of Gems and Jewelery