The World Gold Council, India (WGC) recently tied up with India’s Gem & Jewellery Export Promotion Council (GJEPC) to promote gold jewellery. Both the trade organizations jointly launched ‘Swarna Adarsh Abhiyaan’ recently. Mr. Somasundaram PR, Regional CEO, India, WGC speaks to gems2jewellery.com about the salient features of the new campaign. Here are the excerpts of the interview:
What is the ‘Swarna Adarsh Abhiyaan’ and what role does GJEPC play in it?
SPR: Swarna Adarsh Abhiyaan is an Indian avatar of the global Retail Gold Investment Principles (RGIPs) which is a global initiative led by the World Gold Council to bring inherent trust in retail gold business practices. Swarna Adarsh Abhiyaan was conceptualised by the World Gold Council and developed by an industry steering committee of over 40 members representing every section of this vast business. It suggests a Code of Conduct along with a self-assessment guide for various business streams in the gold industry, viz., Bullion traders, Manufacturers, Jewellery trade, Digital gold product providers and Assay Centres, the idea being to promote and publicise transparent, sound business practices among trade participants who are willing to subscribe to this philosophy and on that basis, secure unwavering trust of consumers in retail investments in gold, be it in the form of jewellery or other. It aims to ensure an efficient, effective, and trusted market overall by introducing best practices and enabling industry participants with operational guidance to sustain such practices.
The Gem & Jewellery Export Promotion Council (GJEPC) is a key member of the steering committee and is closely involved in successful roll-out of this initiative. Swarna Adarsh Abhiyaan is not a mandate but an option for the trade to follow a code of conduct and create a highly trusted global network that stands for the seven supreme RGIPs.
How far the seven principles of Retail Gold Investment are being observed in India and how do you plan to make the retailers follow these principles in widely unorganized Indian jewellery sector?
SPR: India is a key player in the global gold market and is leading the RGIPs initiative. RGIPs help foster trust and confidence amongst both investors and buyers of gold by allowing the industry to operate in a structured manner. With many changes facing the industry due both to policy reforms and introduction of technology, large sections of the industry recognise that there is a need to come together to codify the several best practices in the industry and make them more widely known as the fundamental pillar of success and growth. Along with this, to weed out practices that have potential to adversely taint the industry. A form of self-governance is acknowledged as a ring of safety and has become aspirational, drawing from a few other industry experiments. Swarna Adarsh Abhiyaan is yet in the awareness phase and what we will need is sustained education and awareness programmes in the next 12-18 months before its benefits become more widely accepted and the self-governance model is in place to implement and monitor the scheme.
What difficulties are you facing against smooth implementation of the Abhiyaan?
SPR: We have just launched the initiative. For next few months, we aim to conduct massive industry awareness campaigns working with various associations. Through consistent education and awareness programmes, we are striving to build an ecosystem where in these guidelines become second nature to business. The immediate challenge is awareness given the size and spread of the industry.
What types of policy changes by the Govt. (like reduction in gold import duty) can help the Abhiyaan achieve better success?
SPR: Reforms that address legacy problem areas such as unofficial markets, transparency in price and purity, those that enable FinTech play a significant role in liquidity, integrity and fungibility of gold, reforms such as bullion banking that has potential to bring more gold mainstream will enable Swarna Adarsh Abhiyaan play a highly supportive role in achieving the objectives of these reforms in spirit. In the absence of such reforms, Swarna Adarsh Abhiyaan will still remain relevant but largely aspirational for a large section. Swarna Adarsh Abhiyaan is a self-governance framework and optional, but reforms set the context for the industry’s ambitions.
How much gold consumption (in terms of percentage) would increase in a year if the Abhiyaan goes successful?
SPR: Since the principles are self-regulatory, it would be difficult to quantify its precise impact on consumption of gold, particularly in a year’s time. We have no doubt that RGIPs will overhaul the industry, over a longer period of time, if implemented diligently through an industry self-regulated institution. It will gradually change the consumer mindset and place more trust in the trade, leading to increased consumption thereafter.
Interview by Suresh Chotai