Gold Sector in Kerala Facing Crisis

retailj
By retailj April 10, 2019 13:19 Updated

Gold Sector in Kerala Facing Crisis

Indiscriminate seizure of gold causing hardship to stakeholders

The gold industry in the State is facing an unprecedented crisis with a massive dip in the sales and the supply chain almost at a standstill.

The seizures and restrictions as part of enforcing the model code of conduct has affected the business across the State and now the All India Gem and Jewellery Domestic Council (GJC) has approached Chief Electoral Officer (CEO) Teeka Ram Meena seeking smooth clearance of gold in transit till the polls are over.

Grievances

“We have been receiving grievances from our members about confiscation of consignments despite being accompanied by proper documents.

The indiscriminate seizure and detention of gold, which is a price-sensitive item, is causing great hardship to all the stakeholders in the sector. It has impacted our business in a big way and there has been a 50% dip in sales since the model code of conduct came into effect,” says S.Abdul Nazar, director, GJC, and the treasurer of All Kerala Gold and Silver Merchants’ Association.

P.V. Jose, Chief Patron of Jewellery Manufacturers Association of Kerala, says it’s the first time they are facing such a grave situation.

“No previous election ever affected the industry in this manner.


The supply network has been hit as people are refusing to deliver the goods due to harassment and the service of logistic companies is not available in all parts. We are getting orders, but we are not keen on accepting them as we fear they will be intercepted midway,” he says.

Small and mid-level jewellers are all the more affected as they can’t get hold of any new merchandise this wedding season and even moving the current stock out of showroom for hallmarking can be a risky affair.

Haridasan Mullappally, the Kerala head of BVC Logistics which handles a considerable share of domestic trade, says the situation may go from bad to worst in the coming days.

“Usually they check the documents and if the vouchers and invoices are in order they will let you move. But last week we had to wait more than 12 hours and the consignment was released around 2 a.m. in the night. We are expecting them to intensify the surveillance and checking in the coming days,” he says.

And the industry is bracing for the worst as this year Akshaya Tritiya, when consumer demand skyrockets, is on May 7.

Panic

“There are reports from Tamil Nadu that the confiscated gold will be released only after May 26, creating a panic among stakeholders. As a result dealers and manufacturers are not taking orders. On the other hand buyers are also stalling as many of them are not card-holders. Only thirty percent use debit/credit cards to buy gold and now they can’t carry the amount for buying even two sovereigns,” says Mr.Abdul Nazar.

Courtesy: The Hindu

retailj
By retailj April 10, 2019 13:19 Updated
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