Ahammed M.P., Chairman of Malabar Group - whose company Malabar Gold & Diamonds is opening its 100th outlet next week in Gurgaon - is critical of the Government’s policy on gold.

“The policy, which raised import duty on gold to 10 per cent and imposed curbs on imports, has whipped up gold smuggling underworld which was dormant for nearly a decade,” he says.

In an interview, Ahammed, whose group has business in all GCC (Gulf Cooperation Council) countries, told Business Line that the policy had spawned a parallel, grey market in gold and jewellery.

“This is a big threat to the organised gold jewellery sector,” he said.

“As the General Secretary of the Kerala Jewellers Federation, I am concerned about the damage caused to the gold industry by the policy, but more than that, I am concerned about the impact of smuggling on the society.”

He said that smuggling rackets have mushroomed and several gangs serve gold smugglers.

The members of these gangs are mostly late teens and young adults. “It’s a big threat to peaceful living.”

He said that women were extensively used as carriers for smuggling gold — mainly from Dubai, Singapore and China. Ahammed said that Indian hand-made jewellery is known all over the world “like Swiss watches, German cars and Japanese electronics.”

Crippling effect

Instead of encouraging the jewellery industry, the Government is crippling it with import curbs and customs duties.

He demanded that the duty be reduced to at least 4 per cent — the pre-January 21 level.

Ahammed said his group will post a turnover of Rs 22,000 crore in 2013-14 and is now in an expansion mode.

After Gurgaon, showrooms would be opened in Kolkata, Singapore and Ahmedabad in October.

The brand would go to Sri Lanka, Indonesia, Malaysia and Bangkok next year.

>basheer.kpm@thehindu.co.in

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