We Indians buy gold for everything. Be it a wedding, a gift, religious functions or as an investment. Buying gold in India is a cultural norm, despite the damage that gold imports are doing to the balance of international trade and the subsequent losses that arise therefrom. But does all the gold you’re buying bear the hallmark of purity?
As we all know, the value of gold comes from its purity. The purity of gold is measured in carats, represented by the letter K. 24K gold is the purest, but can’t really be used for making gold jewellery. Jewellers use the more abundant 22K variety of gold, but for the purposes of investing in gold as a commodity – 24K gold is the best.
There have been many reported cases where people have been denied the option of selling their gold because it lacked the necessary purity. There are many jewellery traders in India who dupe customers into buying sub-standard gold jewellery.
It’s mostly in jewellery that adulteration takes place, as pure gold of 24K purity cannot be perfectly moulded into intricate designs and has to be mixed with a certain amount of other metals like silver, zinc and copper. This drastically reduces the purity and value of the gold you’ve spent so much money on. The Bureau of Indian Standards understand that the mixing of metals is necessary to craft jewellery, and hence has set up certain limits that dictate how much of which metal can be mixed with gold in order for the crafted jewellery to retain its value as gold.
The Bureau requires that jewellers send them samples of the gold, to any one of 300 BIS-authorized hallmarking centres across the country, after which BIS agents visit the retailer and assess the jewellery on sale. If the gold is found to be of an acceptable purity meets all the requirements, the jeweller is granted a license verifying the purity of these articles and is allowed to sell them as gold jewellery.
If any of the 13,000 licensed jewellers in India misuses this license, the BIS will take away their license and charge them a fine – but the larger issue that needs to be addressed is that not all merchants claiming to be gold jewellers have this license to begin with. Why? Because it’s not a legal requirement that they need to be licensed, even though that’s the sensible way to go if the objective is to ensure that all the gold being bought is of an acceptable purity.
Most jewellers today are misleading customers by convincing them that hallmarking is a huge additional expense, and serve no other purpose than increasing the cost of the jewellery. In reality, it only costs Rs.25 to get a piece of gold hallmarked, ensuring its purity.
Refer the following list of hallmarks and symbols while buying gold in India:
- Purity grade: This is a number that represents exactly how pure your gold is. A number between 333 (8 karat) and 999 (24 karat) will be embossed on your bullion.
- Bureau of Indian Standards hallmark: This is a triangular stamp.
- BIS Hallmarking Centre Logo: It’s important to know which hallmarking centre has certified your gold.
- Year: This is a code alphabet that represents the year in which the gold was marked. The code is decided by the BIS.
- Jeweller identification: Jewellers maintain their own mark of identification, of BIS certification.
Don’t be fooled by big brand names and highly advertised jewellers – if your gold isn’t hallmarked, it’s probably adulterated and impure.
Since the trend of buying gold in India is shifting from jewellery to coins and bullion – for the purposes of investments and as gifts that keep on giving, it’s easier to ensure that your gold is hallmarked for its purity, as the hallmark will be present on the gold itself.
It would be very prudent and fitting to purchase internationally tradable gold from established merchants, although the price for this will be slightly higher than the current market rate. It’s a good practice to systematically plan and invest in gold regularly, albeit not a lot as this would adversely affect the balance of imports and exports in the macroeconomic scenario.
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