Malabar Group chief warns against arbitrary gold pricing

New Delhi, Jan 16 (PTI) Malabar Group Chairman M P Ahammad on Friday sounded a note of caution against certain emerging practices in gold price determination in India, saying they deviate from established norms and risks, undermining the credibility of the country's gold trade.

In a statement, Ahammad said gold prices are determined by three key factors: international gold prices, the exchange rate of the Indian rupee against the US dollar, and import duty.

While customs duty remains fixed for a defined period, fluctuations in global prices and currency movements make daily price revisions necessary.

Traditionally, gold prices are set in a transparent and reliable manner by trade associations and published before 9.30 am. Prices fixed for the day are revised only in cases of exceptional market volatility.

However, Ahammad noted that "in certain instances, a section of traders has been increasing prices arbitrarily, contrary to the established mechanism, without offering clear justification to consumers".

Such practices, he warned, could erode trust in the sector and create concern among consumers, investors, and industry stakeholders.

He urged all concerned to refrain from actions that compromise the integrity of the trade, adding that consumer interest remains the foremost priority for Malabar Gold & Diamonds and that all business practices must be guided by transparency and fairness.

Ahammad also highlighted the company's 'One India One Gold Rate' initiative, introduced to eliminate price disparities across states.

Since tax rates are uniform nationwide, gold -- whose price is linked to international benchmarks -- should be sold at a uniform price across the country, he said. PTI LUX LUX TRB TRB