Jewellers’ rift prolongs suspension of gold rates in Pakistan

KARACHI: Pakistan’s gold market is in a state of limbo as bullion rates remain suspended for the fourth consecutive week amid a rift among jewellers over the formation of a committee to regulate the industry.

The suspension of official gold prices came after a crackdown by authorities on speculators and traders who were accused of manipulating the market and causing a sharp spike in gold rates last month. On September 12, gold prices in the local market jumped by Rs5,600 per tola, or 11.66 grams, to Rs215,000 rupees, despite a decline in the international market.

The subsequent crackdown by law enforcement agencies aimed to target speculators and traders involved in potentially manipulative activities. The crackdown led to the suspension of bullion rates. Since then, gold has been trading unofficially at varying rates, with prices hovering around Rs190,000 rupees per tola after appreciation of the local currency, according to traders.

The Ministry of Commerce has been trying to resolve the issue by forming a committee comprising representatives of various stakeholders, including jewellers, traders, exporters and importers. However, the process has been marred by disagreements and disputes among jewellers over the composition and mandate of the committee.

Al-Haj Haroon Rasheed Chand, President of the All Pakistan Gems and Jewellers Association, conveyed optimism in a message on Friday, expressing hope that bullion rates would be resumed from Monday. However, previous promises regarding the reopening of bullion rates have not been met with implementation.

The uncertain state of the gold market has revealed fractures within the jeweller community, with reports of internal division and grouping coming to the fore. These divisions were exacerbated by a recorded message from Chand, addressed to the media and law enforcement agencies.

Chand expressed his dissatisfaction with the inclusion of some individuals in the committee, who he claimed were not qualified or credible to represent the industry. He alleged that certain individuals included in the committee were detrimental to the industry's interests and lacked the capability to lead it effectively.

Chand also said that he was excluded from the committee despite his efforts to protect the industry’s interests. The emerging dispute within the gold industry has left industry stakeholders and investors perplexed and uncertain about the market's future trajectory. The lack of clarity and discord among key industry players have added to the challenges facing the gold market, further prolonging the suspension of bullion rates.

The unresolved issues within the gold market are a cause for concern, particularly in an industry that plays a vital role in Pakistan's economic landscape. As industry leaders grapple with differences of opinion and conflicting interests, it remains to be seen when and how the bullion rates will eventually be reinstated, and stability can be restored to this crucial sector.