Gold curbs to arrest CAD hit West Bengal’s artisans hard.

KOLKATA: With elections round the corner, the Mamata Banerjee government is perturbed over artisans in gold trade losing jobs as there is hardly any work with jewellers due to supply crunch of the yellow metal.

The state supplies the best artisans in jewellery trade and nearly 1 crore people from the state are engaged in the trade.

Talking to ET, the state labour minister Purnendu Basu said, "If things take a turn for the worse, then we will try to find schemes where these artisans can be absorbed. It is a matter of great concern for us. Let's see what steps the Central government takes on gold. We will also talk to the state's jewellery trade to find out a way. We cannot allow artisans to remain jobless."

The jewellery trade employs nearly 3.5 crore ar artisans. Among them artisans from Bengal are famous for their handmade jewellery, which are sold at a premium.

Nemichand Bamalwa, member, All Indian Gem & Jewellery Trade Federation said "Nearly 15 -20 lakh artisans from Bengal are jobless right now. If this situation continues for another two to three months then they will be forced to leave the profession and look for some other profession. But that too will be difficult for them.

As of now there is hardly any demand in gold and whatever minimum work is taking place is in the recycled categories where families are redesigning their old gold to meet immediate requirements." But there seems to be no respite for the gold trade immediately.

According to agency reports, revenue secretary Sumit Bose has said that review of gold curbs will take place by the end of March. India used to be the world's biggest importer of gold until 2012. But the swollen CAD forced the government to increase import duty on gold from 2% to 10% and rule.

"We are more concerned about the 80:20 rule that has resulted in increased smuggling of gold through the NRI route. This rule should be removed immediately if the sector has to survive. Otherwise many will lose their living," added Bamalwa.

On July 22 last year, the Reserve Bank of India had said that a fifth of the gold purchases by importers in every lot would have to be exclusively made available to exporters. It said only 80% of the imports could be used for domestic purposes, and that too for entities engaged in jewellery trade, bullion dealers and banks.

In fact, Congress president and UPA chairperson Sonia Gandhi has written a letter to the commerce ministry to look into the matter following a meet with the All India Gem & Jewellery Trade Federation. Commenting on the outlook for gold, Sugandha Sachdeva, AVP (metals, energy and currency research), Religare Securities said "At MCX, Rs 29,650/10gm and Rs 29,900/10gm remain immediate supply zones, above which prices may soar towards Rs 30,500/10gm in near term. On the flip side, in case prices fail to breach the said levels, they can testRs 28,850-28,800/10gm on the lower side.

Source : economictimes.indiatimes.com