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One Nation, One Rate Policy on Gold: With the announcement of reduction in customs duty on gold and silver in the Union Budget, the price of gold and silver has come down significantly. However, the rate of fluctuation was different as the prices still varied in different states. The central government is now going to implement One Nation One Policy by eliminating this difference in the prices of gold and silver. The jewellery industry has also started preparing for it.
What are the preparations for 'One Nation, One Rate'?
To bring transparency in gold prices, efforts are being made to have a single rate of gold (ONOR) across the country. According to media reports, the Modi government may implement the One Nation One Gold Rate policy across the country next month. The Gems and Jewelry Council has given in-principle approval to this proposal. The decision will be announced soon.
It will start from eastern India
The gold jewellery industry is supporting the One Nation One Rate policy. The implementation of this policy can start from eastern India in August. Samar Kumar Dey, chairman of Save Gold Craft Committee, said that the idea of implementing a single price of gold across the country is in the interest of all stakeholders. Bullion dealers are also involved in this initiative. A uniform rate will be implemented for Bengal and eastern India from August.
Why is the price of gold different in different states?
Gold prices depend on many factors. Hence prices vary in different cities of the country. Local conditions and market trends affect the price of gold. Gold and silver prices vary in every city due to many factors like demand for gold in the local market, labour cost, state government policies, taxes, etc.
Gold prices are low in markets with low taxes, duties and high demand, while gold prices are high in markets with high taxes-high duties and low demand. With the implementation of the One Nation, One Rate policy, gold will be available at the same rate everywhere.
Benefits of this policy
Measures like GST, hallmark have made the jewellery industry more transparent. These measures are aimed at protecting consumers from fraud in the purchase of gold. Having a uniform tariff across the country allows gold to be obtained at the same price from any place.
• Currently, gold prices vary across the country. There is confusion among consumers due to different gold prices in every city. The new policy will remove this confusion.
• The implementation of the 'One Nation, One Rate' policy will reduce uncertainty in the bullion market. As soon as gold prices stabilize, consumers can buy gold with confidence.
• Implementing a single rate across the country will create confidence among investors. This will increase national and international investment in the gold market. It is expected that this will benefit traders and consumers and gold prices will come down further.
• Industry experts said the steep reduction in duty would also help curb smuggling.
According to industry sources, there is also concern about whether the government has any other plans related to GST for gold. GJC has appealed to the GST Council to reduce the tax rate on jewellery from the current 3% to 1%.
