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Explained: Hallmarking process for gold and what it means for the jewelry industry

Explained: Hallmarking process for gold and what it means for the jewelry industry

Explained: Hallmarking process for gold and what it means for the jewelry industry
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By Yashi Gupta  Nov 20, 2020 12:12:43 PM IST (Updated)

Hallmarking is a voluntary exercise, cast down by the non-transparency and high cost associated with it. If a customer does not insist, they are sold untested jewelry. As a result, only 40 percent of the gold sold and purchased in the country is hallmarked.

From June 2021, only hallmarked gold and silver jewelry will be sold in the country, according to the directives released by the Ministry of Consumer Affairs, Food & Public Distribution.

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Consumer Affairs Minister Ram Vilas Paswan, in January this year said that  violation of this will attract penalty and imprisonment of one year.
Previously, jewelers had one year to register themselves with the Bureau of Indian Standards (BIS), clear out the old stock, and implement the mandatory hallmarking. But keeping the COVID-19 pandemic in mind, government has extended the time till June 2021.
In this explainer, we aim to dive into the hallmarking process and what it means for the jewelry industry.
Hallmark
A hallmark is an official mark struck on precious metals to certify the content of the noble metals like gold, silver, platinum. In simpler words, a hallmark lends credibility to the purity of the jewelry. Moreover, it obligates manufacturers to maintain the legal standards of fineness and purity.
Currently, in India, Gold and Silver come under the purview of Hallmarking.
The hallmarking process is carried out at the assaying and hallmarking centers present across the country and monitored by the Bureau of Indian Standards (BIS).
Jewelry buyers are often discouraged by the makers from hallmarking their metals on the fear of added cost and delayed delivery. To safeguard the buyers from this ruse, the government plans on making the hallmarking process quicker and transparent by establishing centers in every district of the country.
The Hallmarking System
India uses the BIS hallmark system for certifying gold and silver jewelry to establish the purity of the metal. It certifies that the jewelry conforms to the set of standards per the Bureau of Indian Standards, India's national standards organization. BIS comes under the Ministry of Consumer Affairs, Food & Public Distribution, Government of India.
The BIS Hallmarking System has been aligned with the International criteria of hallmarking. As per this system, registration is granted to the jewelers by the BIS. The jewelers can then get their jewelry hallmarked from any BIS recognized Assaying and Hallmarking centers.
The Hallmarking Process
According to the new directives released by the Ministry of Consumer Affairs, Food & Public Distribution, hallmarking takes place for jewelry in three categories: 14 carats, 18 carats, and 22 carats.
The process of gold hallmarking involves three steps: homogeneity testing, purity testing, and marking individual items.
Homogeneity testing samples the items to ensure that they adhere to the basic regulatory standards.
Purity testing is a little complex process. In the first step, the bodies select the items that need testing, followed by carrying out the preliminary testing on the surface of selected items. The purity testing is completed by taking smaller samples from every item for detailed testing.
Finally, the centers carry out intense assaying to gauge the finesse of the metal.
The entire process takes five to six hours before the gold is ready to be hallmarked. Once they are satisfied by the results, hallmarks are applied via hand/press marking or laser marking.
The Hallmark on Gold Jewelry carries four marks: BIS mark, purity in carat, assay center's name, and jewelers' identification mark.
The Jewelry Industry
Hallmarking is a voluntary exercise, cast down by the non-transparency and high cost associated with it. If a customer does not insist, they are sold untested jewelry. As a result, only 40 percent of the gold sold and purchased in the country is hallmarked.
Keeping this in mind, the government has made it mandatory that only hallmarked gold and jewelry be sold in the country from January 15, 2021.
This decision not only impacts the buyers but jolts the jewelry industry as well. However, Somasundaram PR, the Managing Director of the World Gold Council India, believes that this decision would boost the market for Indian handcrafted gold material while safeguarding consumers' interests, leading to further expansion of the industry.
He told PTI that the move would help create jobs in gold assaying and level the field for smaller jewelers.

Currently the country is home to 892 assaying and hallmarking centres in 234 district locations who carry out hallmarking process for 28,849 BIS registered jewelers. This number is expected to increase with the government's directives to make the process more candid and straightforward.

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