Leading jewellers are preparing to align with Prime Minister Narendra Modi’s push to curb gold imports by encouraging customers to exchange old jewellery for new designs instead of making fresh purchases.
The surge in gold prices has already accelerated the trend, with many consumers opting to trade in old ornaments to offset the cost of buying new jewellery. Jewellers, in turn, are rolling out attractive exchange offers and promotional schemes to tap into the growing demand for gold recycling and replacement purchases.
Kalyan Jewellers India, for instance, recently launched the ‘Nation First – Gold4India Initiative’, a strategic framework to activate dormant household reserves of the precious metal. The company through the initiative has set a target to reduce imports by 5 tonnes in this financial year.
Bringing inactive gold into circulation
TS Kalyanaraman, Managing Director, Kalyan Jewellers India, said the initiative will spark a behavioural shift in consumers to recognise gold as a renewable domestic resource capable of continuously generating economic value within the country.
If even a fraction of this inactive gold can be responsibly brought back into circulation, India can potentially reduce incremental dependence on imported gold, he said
Tanishq, through its ‘OldGoldNewIndia’ campaign, is accepting gold ranging from 9k to 22k for recycling. The company also accepts gold from any jeweller, including broken or small pieces of jewellery.
Arun Narayan, Chief Executive Officer, Jewellery Division, Titan Company, said over the past 8 months, Tanishq has been calling out for jewellery purchases through old gold exchange to minimise imports and 4.4 lakh customers have responded by exchanging over 10,000 kgs of gold in this short period.
20% recycling growth
“We remain committed to this purpose and offer the best exchange process that is completely transparent and offers the best value for old gold,” he said.
During the March quarter, Titan Company sold gold-ingots worth Rs 6,144 crore (Rs 864 crore) as part of its inventory management.
Malabar Gold & Diamonds has reduced the minimum deposit under its Gold Monetisation Scheme from 10 grams to 1 gram.
Most leading jewellers are using karat meters and XRF machines to accurately determine gold content in jewellery to be recycled. The final valuation is then calculated based on prevailing market prices.
Raghav Dhir, Director, Dhirsons Jewellers, said the company has registered 20 per cent growth in exchange of old gold compared to last year.
PM Modi’s speech has sensitised Indians to mobilise jewellery lying idle in lockers, he said.
Though import duty hike will cause a temporary slump in purchases, consumers eventually absorb the hike and gold demand in India gets its way back on track, he said.
Supriya Kataria, Founder, Kumari Fine Jewellery, said though players across the industry have intensified programmes on gold exchange now, it is more of a generational mindset shift that will take time to warm up, especially with budget-conscious customers.
“The Indian belief system remains rooted to buying gold that adds to one’s wealth and prosperity, so we await this shift to be accepted by young consumers,” she said.