Monitoring standards for jewelers in limbo

KATHMANDU, Feb 2:

Though the government and bullion traders had agreed to prepare minimum monitoring standards for the trade of precious metals by May last year, they have not yet been able to finalize the standards owing to their differences on the “level of purity” of jewelries.

Due to the lack of monitoring standards, the inspections being carried by the government have often been questioned while the traders are finding a pretext to get away with anomalies.

The government insists that the traders should maintain the purity level of gold jewelries as set by Nepal Bureau of Standards and Metrology (NBSM), and sell jewelries mentioning the level of purity of their products. The traders, on the other hand, say that the metal loses a degree of purity by the time it is processed into jewelries.

According to the standards set by NBSM a 24-carat and 22-carat gold jewelry should have at least 99.5 percent and 91.60 percent purity, respectively. After the government found some traders selling impure gold jewelries, a nine-member committee including the representatives from all the stakeholders was formed on the first week of May last year.

The team was supposed to prepare monitoring standards within May.

“Though a rough draft of the monitoring standards has already been prepared, we have not come to an understanding on the issue of purity of jewelries,” said Hari Narayan Belbase, director of the Department of Commerce and Supply Management.

According to Belbase, if traders claim that the jewelry lose certain degree of purity, they have to sell jewelries as per its latest standard.
“If they lose purity of 24-carat gold to 97-98 percent, they should charge customers the exact amount equivalent to available portion of gold in jewelry,” Belbase said.

He also informed that the guidelines will be issued immediately if traders compromise on the issue.

Traders, on the other hand, term the idea of selling gold jewelries in accordance to availability of gold to be impractical as well as illogical.
“We pay customs as per the prevalent international rate per carat of gold,” said Mani Ratna Shakya, president of Federation of Nepal Gold and Silver Dealers’ Association. “We cannot afford to bear loss by selling the jewelries at a lesser rate also because a certain portion of the precious metal is automatically lost in the process of jewelry manufacturing.”

Shakya further charged the government with trying to bypass the demand of traders. “The government seems reluctant to the issue of formulating new monitoring guidelines as the committee rarely meets to settle the issue,” he said.

Shakya went on to charge that gold being supplied by the government itself is found to be substandard.

Nonetheless, both the government and traders believe that monitoring would be effective and would help the growth of the bullion industry once minimum standards are set at the earliest.

Source: Republica