The India Bullion and Jewellers Association (IBJA) has backed the Centre’s efforts to curb gold demand and proposed a monetisation scheme for nearly 1,000 tonnes of idle gold held by temple trusts across the country to reduce pressure on imports and foreign exchange outflows.

The industry body said the proposal could also help safeguard employment in the jewellery sector, particularly among small jewellers, artisans and labourers dependent on the trade.

The development comes after Prime Minister Narendra Modi urged citizens to reduce gold purchases amid rising imports and pressure on the country’s current account balance.

Backing the government’s position, IBJA Gujarat State President Nainesh Pachchigar said the association has “decided to stand in support of the government” and has begun holding meetings across the country to balance national interest with business continuity.

According to Pachchigar, the government’s move to increase excise duty on gold from 6% to 15% is expected to moderate domestic demand and curb forex outflows linked to precious metal imports.

Temple gold monetisation proposal

The association has suggested that large quantities of gold lying idle with religious trusts and temples could be brought into productive use through a monetisation framework without transferring ownership to the government.

“Many trusts currently hold large quantities of idle gold—nearly 1,000 tonnes in total. If even a portion of that gold can be utilised, it would help significantly,” Pachchigar said.

IBJA clarified that it is not seeking permanent acquisition of temple gold reserves by the government. Instead, it has proposed a mechanism through which the idle gold could be monetised while ownership remains with the trusts.

Industry players believe such a move could help reduce dependence on imported gold, which remains one of India’s largest import items after crude oil.

Precious metals rally continues

Meanwhile, bullion prices continued their sharp upward trend this week.

Silver prices surged by ₹12,900 per kg to ₹2.69 lakh, compared to ₹2.56 lakh recorded on May 9.

Gold prices also witnessed a steep rise, with 10 grams of gold climbing by ₹7,132 over the past week. The price, which stood at ₹1.51 lakh on May 9, has now increased to ₹1.58 lakh.