Hallmarking for 9 carat gold gets green light: What it means for consumers

Business Standard

6 days ago

The government has approved hallmarking standards for 9 carat gold, making it officially part of the Bureau of Indian Standards' (BIS) hallmarking system. The notification was issued by the Ministry of Consumer Affairs, and the rule will take effect from this month, June 2025.
What's happening: According to BIS, 9K gold must have a minimum fineness of 375 parts per thousand, and will now be subject to the same regulations as other gold categories. Jewellers and hallmarking centres must comply starting July 2025.
Why it matters: Gold prices have surged to record highs in India, crossing ₹99,000 per 10 grams and briefly hitting ₹1,00,484 on the MCX. This has led to many consumers being priced out of the market. By making 9 carat gold (which costs roughly ₹38,110 per 10 grams, including GST) part of the hallmarking system, the government aims to:
The background: Until now, hallmarking in India was permitted only for 24K, 23K, 22K, 20K, 18K, and 14K gold. The BIS hallmark certifies the gold's purity (measured in parts per thousand) and ensures consumer protection under the BIS Act, 2016.
The absence of 9 carat gold from the list had limited jewellers' ability to sell lower-purity, affordable options with government-backed certification. That gap has now been filled.
This development comes after a steep 60 per cent drop in gold sales by volume in June, the sharpest decline since the Covid-19 pandemic.
Why have gold prices surged? Gold prices are surging due to a combination of global and domestic factors. Investors are turning to gold as a safe-haven asset amid heightened geopolitical tensions, particularly between the US and China, and growing political instability.
A significant drop of over 4 per cent in the US Dollar Index this year has further boosted gold's appeal on the global stage. Central banks, especially in Asia, are increasing their gold reserves to diversify away from the US dollar, driven in part by concerns over political risks such as the freezing of Russian central bank assets. Additionally, the US Federal Reserve's interest rate cuts have made gold, which does not yield income, relatively more attractive.
In India, domestic demand remains strong due to cultural and seasonal factors—key festivals in India traditionally see a rise in gold purchases, keeping demand high regardless of price trends.
Industry speaks: Officials and industry leaders have welcomed the move as overdue and timely.
'We had been urging the government to introduce hallmarking of 9 carat gold for over a year,' said Surendra Mehta, national secretary, India Bullion & Jewellers Association (IBJA), speaking to The Economic Times. 'This will spur demand, especially in rural areas.' Suvankar Sen, MD & CEO of Senco Gold, added, 'It's a great initiative to make gold jewellery more accessible amid high prices. Modern designs come out smartly in 9K gold, and this move also supports innovation and exports.'
The bigger picture: India is one of the world's largest consumers of gold, using 800–850 tonnes annually. Global factors, including inflation and geopolitical tensions like the Russia-Ukraine war, have driven up gold prices by over 25 per cent in the past year.
Amid this, jewellers are increasingly turning to lower-carat jewellery to reduce production costs and attract budget-sensitive buyers, and hallmarked 9K jewellery could unlock new export opportunities, especially for lightweight, design-centric collections.
What to watch out for: The new standard takes effect from July 2025, so not all jewellers may immediately offer hallmark-certified 9K gold.
Consumers should look for the BIS hallmark and the fineness mark (375) when buying 9 carat jewellery.
Gold watches and pens are now excluded from the BIS artefact definition; consumers should be aware that these items may not be hallmarked even if ma