A recent national survey has highlighted a significant trend in Punjab where many consumers are purchasing non-hallmarked gold jewellery, raising concerns about consumer protection and the need for stricter enforcement of hallmarking standards.
Survey Insights and Findings
The survey conducted in 19 districts of Punjab, where hallmarking has been mandated, involved 4,090 consumers. These districts include Amritsar, Barnala, Bathinda, Fatehgarh Sahib, Fazilka, Ferozepur, Gurdaspur, Hoshiarpur, Jalandhar, Kapurthala, Ludhiana, Malerkotla, Mansa, Moga, Pathankot, Patiala, Sangrur, Nawanshahr, and Muktsar.
The findings reveal that 30% of the respondents or their families had purchased non-hallmarked gold jewellery in the past 12 months, while 61% reported buying hallmarked gold ornaments. Among those who bought hallmarked jewellery, a significant portion incurred additional costs: 45% paid 10-20% extra, 37% paid up to 10% more, and 8% paid over 20% more compared to non-hallmarked items. Only 10% of the consumers purchased hallmarked jewellery without any additional cost.
Moreover, nearly 30% of the consumers bought gold jewellery without paying the Goods and Services Tax (GST). Of these, 18% made their purchases in cash to avoid the GST, while 13% did not pay the GST to keep the overall cost lower.
Call for Stricter Enforcement and Regulation
The Bureau of Indian Standards (BIS) has been implementing mandatory hallmarking of gold items across India since 2021, currently covering 343 districts. The hallmarking process certifies the purity of gold jewellery, aiming to protect consumers from substandard or impure products.
Sachin Taparia, founder of LocalCircles, underscored the importance of strict enforcement of these regulations. He stated, “The BIS will have to state the required steps for enforcing regulations to prevent the sale of non-hallmarked jewellery. Not only that, the authorities must also ensure that jewellers are not charging exorbitant fees for the hallmarking process.”
Taparia also suggested that the government should prohibit jewellers from separately quoting and charging consumers for hallmarking. He elaborated, “By mandating that hallmarking costs be included in the overall price of the jewellery, customers can have a clearer understanding of the total expense without any hidden fees.”
Implications for Jewellers and the Industry
The prevalence of non-hallmarked gold jewellery in Punjab points to a broader issue of consumer awareness and regulatory compliance within the jewellery industry. For jewellers, this highlights the necessity of adhering to hallmarking standards to ensure consumer trust and compliance with legal requirements. The additional costs associated with hallmarked jewellery indicate a need for pricing strategies that incorporate hallmarking fees clearly.
The call for more rigorous enforcement and regulation by the BIS also signifies potential changes in industry practices, where jewellers might need to adapt to new compliance measures and pricing structures. This shift aims to enhance consumer protection and ensure fair pricing practices in the gold jewellery market.
