Gem stocks, bullion lose lustre

Nisha Das
06 February 2004

The Union government's Export Import (Exim ) policy announcement of free import of gold has failed to bring any cheers to the stock and domestic bullion markets. The gems and jewellery stocks have reacted passively on the Bombay Stock Exchange.

"The announcement of allowing direct import does not make much of a difference. Even the baggage allowance of NRIs, which has been freed from quantitative restriction of 10 kilogram does not make much of material impact," officials with the Gem and Jewellery Export Promotion Council said.

Mr Sanjay Kothari, chairman, Gem and Jewellery Export Promotion Council said, "Domestic gold price is directly linked to the price in the London Metal Exchange. So, policy changes do not create major differences in the domestic bullion market. The same has happened with the new Exim policy announcement as well."

Ms Chanda Narang, CEO, Frazer & Haws, a Delhi-based gold and silver jewellery and decorative firm, said, "Each year, India imports around 500 to 600 tonnes of gold and around 2,700- 3,000tonnes of silver. Now any one can import gold and silver. The importers do not necessarily import through the 19 nominated agencies. This could be the reason for such a
reaction in the stock market.

She added that further clarifications were awaited by the industry. "If free import of gold and silver leads to liberalisation and cutting down of complicated procedures then it's good for the country, "she said.

The stock price of SB&T International dropped to Rs 53 from Wednesday's closoe Rs 57.55 on the BSE , while. Suashish Diamonds dipped from Rs 47.50 to Rs 45-and Sunraj Diamonds slipped from Rs 26.75 to 22.60.