Old is gold, recycle, and it's sold

Old is gold, recycle, and it's sold

In a bid to cut down India’s gold imports and improve the current account deficit of the country, Kerala-based Muthoot Pappachan Group has forayed into the into retail gold aggregation and recycling segment through Muthoot Gold Point, an arm of Muthoot Exim.

Muthoot Gold Point will buy scrap, old and used gold items directly from the customers.

The company is planning to open three Muthoot Gold Point outlets by March 2015 in South India and will plan its expansion to other regions of the country based on the response to the initial foray.

“India had imported gold to the tune of around Rs 2.3 lakh crore last year (approximately 800-900 tonnes) due to which the current account deficit swelled to huge limits. Through this foray, we expect to reduce the level of gold imports which will directly have an impact on the current account deficit of the country,” Muthoot Pappachan Group Precious Metals Business CEO Keyur Shah told Deccan Herald.

“The rate offered to the consumer will be derived after testing the weight and purity of the gold and will be given as per live market rates. We will refine it into gold bars and supply it to the domestic market which will help in reducing imports,” Shah said. "We plan to be the first organised national player in the segment soon."

The project will be capital intensive as we will have the best technical instruments for testing the weight and purity, Shah said, adding that it would be difficult to give the quantum of investments involved in the project currently.

According to industry estimates, around 25,000 tonnes of gold is estimated to be in the custody of private households and trusts across the country. Only 200-300 tonnes get recycled annually leading to a very high dependency on imports.

Also, currently the aggregation and recycling of gold is mainly conducted by the unorganised sector without any standardization or transparency in the system.

DH Newsletter Privacy Policy Get top news in your inbox daily
Comments (+)