New Delhi: Covid pandemic has a cascading effect on Indian economy. The deadly virus has also left several people bankrupt and they are struggling to make ends meet. In this critical juncture more people are resorting to gold loan or selling off their gold jewellery in order to ease the financial burden, according to a Bloomberg report.
- People residing in rural areas are vey much dependent on gold as the precious metal is easy to liquidate. People living in southern part of India have sold 25 per cent more old gold than they usually do, as per the Bloomberg report.
- The report has predicted that if new wave of the deadly Covid arises, then gross scrap supplies including old gold being melted to make new designs, would witness a huge surge.
- As covid has hit the livelihoods of people in India, more over 200 million have started earning less than minimum wage, or USD 5, per day, as per the Bloomberg report.
- There are very decent footfalls in gold shops, one is demand due to wedding festival and other is cash liquidation, managing director of Kochi-based refiner CGR Metalloys Pvt James Jose was quoted as saying by Bloomberg.
- Notably, the gold sales dipped to the lowest in over two decades in 2020, Bloomberg reported quoting World Gold Council.
- Demand may rise this year but third wave still remains critical factor, the report noted.
- Meanwhile, in a major relief for jewellers, the Karnataka Authority for Advance Ruling (AAR) has held that in case of resale of second-hand gold jewellery, jewellers have to pay GST only on the profit earned from such sale, as per an IANS report.
- According to experts, the development would reduce the GST payable on resale of used jewellery, the IANS report says.