An Indian women's commission wants to restrict gold at weddings
India's latest scheme aimed at reducing gold imports targets the very root of the problem: Weddings.
According to a report by Bloomberg TV, the Kerala State Women's Commission is proposing a law that would restrict the amount of gold that can be used in a wedding – limiting what a bride and groom can each wear.
C Rosakutty of the Commission said the measure "may reduce the affinity to wear the gold."
The Reserve Bank of India sees gold as a major contributor to the country's current account deficit and has been implementing a series of measures aimed at reducing imports.
Official gold imports have indeed declined over the past year as the government's restrictions have taken effect.
In 2011, gold imports reached a peak of nearly 1,000 tonnes. According to Reuters, 2013 levels will likely be between 700-750 tonnes.
But these figures don't take into account bullion's black market. Restrictions and high tariffs have given rise to heightened levels of gold smuggling.
According to one report, the amount of gold entering the country illegally this year has probably doubled.
Meanwhile, the Times of India reported in December that almost every passenger arriving on a flight from Dubai To Calicut "was found carrying 1kg of gold" – legally. Non-resident Indians are allowed to carry 1kg of gold when they enter the country.
The yellow metal is in particularly high demand during the wedding season – November to January.
But restrictions and tariffs have made life difficult for Indian jewellers: In December they were paying a $130 premium per ounce over the London fix price. The wedding law proposed by the Women's Commission would add another layer of trouble, this time from the demand side.