Amendment for mandatory hallmarking of jewellery

The Indian government plans to shift to mandatory jewellery hallmarking system replacing the voluntary system which started in 2001.

In a significant move for jewellery consumers in India the worlds largest gold buyer the government plans to shift to mandatory jewellery hallmarking system replacing the voluntary system which started in 2001.

Sources say the government is all set to amend the Bureau of Indian Standards Act,1986 to pave way for compulsory hallmarking of jewellery of gold,silver and platinum. The move holds significance in view of the fact that domestic gold consumption,most of which is for jewellery,has jumped manifold in the country from annually about 65 tonnes in 1982 to about 900 tonnes currently.

Under the move,the government plans to amend Section 14 of the BIS Act,1986,which restricts the articles for compulsory Indian standards only for the articles of the scheduled industry. For this purpose,the BIS Act has been using the definition of scheduled industry as defined in the Industries (Development and Regulation) Act,1951.

Currently,jewellery items are not under the scheduled industry and are consequently out of the compulsory hallmarking. BIS sources confirmed that the inter-ministerial consultations over the proposed amendment to the BIS Act are complete,and it would be soon be up for Cabinet approval.

The government plans to do away with this restriction of compulsory licensing of Indian standards only to scheduled industry and bring it under the domain of the consumer affairs ministry,which will,through an official notification,provide for mandatory Indian standards to protect the consumers of all industries,including gold jewellery.

However,sources say the move would still ensure that all the articles related to the scheduled industry as defined in the Industries (Development and Regulation) Act,1951 to be asked to follow Indian standards compulsorily.

The move holds significance in view of the fact that there are about 100,000 jewellery manufacturing units throughout India,mostly employing up to 10 workers,with only a few hundred large mechanised factories employing up to several hundred workers.

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Country had started voluntary jewellery hallmarking scheme in 2001,where BIS was named as the sole agency in the country for hallmarking of gold jewellery under the provisions of the BIS Act,1986. The system provided for provisions of penalty for deviations in purity of fine metal,which included cancellation of BIS recognition,by the agencies or shops that had acquired license for selling and purchase of hallmarked Jewellery.

Currently,there are about 150 agencies across the country that have BIS licence for certifying the hallmarked jewellery to about 7,300 retail outlets that have voluntary acquired BISs licence for trading hallmarked jewellery across the country.

Under the system,the BIS conducts regular market surveillance on the certified jewellers,at a defined periodicity on random basis,which includes collection of hallmarked gold jewellery from licencees retail outlet/manufacturing premises and having it tested for conformity in BIS recognised hallmarking centre.

BIS sources,however,say that given the massive structure of trade in the sector,the compulsory hallmarking would most likely be started in a phased manner with certain areas (like metros or big jewellery manufacturing and consumption centres) to be the first to start the mandatory hallmarking.