The issue of hallmarking to safeguard consumers in India - the world's biggest gold market - took centre stage at the sixth edition of the Dubai City of Gold Conference organised by the Dubai Gold and Jewellery Group.
Experts at the event also said the trend in India was changing in favour of the organised sector.
A campaign by Tanishq, one of India's largest gold retailers, struck a sensitive chord at the conference.
The scene opens with a husband presenting a sparkling gold necklace to his smiling wife. Suddenly, a voice-over questions the stunned couple: “Wait! Is that 22-carat jewellery made of 22-carat gold? Perhaps, not.''
The couple frown as a carat meter suddenly pops up and shows that what they thought was 22-carat gold to be 16.7-carat gold.
In his presentation, V. Govind Raj, Vice-President for Retail and Marketing, showed how Tanishq, part of Titan (controlled by the Tata group), tackled the issue of cheating head on in an industry known for rampant impurity in the gold it sells.
Tanishq's campaign has spawned widespread calls for hallmarking in the world's biggest gold market. Over 800 tonnes of gold are sold annually in India, compared to Dubai's 500 tonnes which are mostly re-exported.
But unlike Dubai - considered one of the safest places to buy gold - a Bureau of Indian Standards (BIS) survey in Delhi revealed that 80 per cent of consumers get only 84.5 per cent value of the money they paid for the gold.
Tanishq pioneered the installation of Rs1-million-a-piece (Dh 91,928) carat meter in each of its 105 stores in 71 Indian cities and the 20 new stores planned this year.
“Fascination with gold has been part of our culture over the centuries,'' said Raj. “But now, there has been a change in consumer consciousness on the purity issue.''
Government pressure on gold traders for BIS hallmarking, however, fizzled out due to severe resistance from traders, he complained.
Companies such as Reliance and Titan are venturing into an industry long dominated by family-owned businesses, with organised jewellery retail in India accounting for a measly four per cent of the trade, against the unbranded mass market commanding $14 billion (Dh51.4 billion) of a total of $20 billion (Dh73.4 billion) trade.
Bijou Kurien, President and Chief Executive for Reliance Retail's Lifestyle Division, said India's enormous but fragmented jewellery market would benefit from consolidation on the back of increasing prosperity.
“It's a very exciting time with a lot more competition, and with much better focus on brands, styles and designs. The trend is changing in favour of the organised sector,'' said Kurien.
Reliance plans to have 400 jewellery stores across India in five years, Kurien added.
The event, where challenges facing the gold trade were discussed, also saw retailers from across the world, issue a call to the gold industry to pull up its socks.
Tawhid Abdullah, Managing Director of the Dubai Gold and Jewellery Group, challenged the gold industry to get its act together in the face of high gold prices and “fragmentation''. “We have big names but we don't have a unified voice. We need to join forces and speak in a single, loud and clear voice,'' he said.
Abdullah, who is also the managing director of Damas, which has 430 stores worldwide - 27 of which are in India - urged industry leaders to learn from the watch industry's foray into the retail and fashion sector.
“I would like to see synergies between big and medium-sized companies,'' said Abdullah who plans to open more than 50 stores in India, Saudi Arabia and Egypt, among others this year.
“I do hope to partner with companies such as Tanishq,'' he said.
Jodhaa and Akbar may have faded into legend, but their story lives on in the present-day jewellery shops in India.
According to reports, over 400 kg of gold jewellery made by Tanishq was used during the making of the recent Bollywood blockbuster Jodhaa-Akbar.
V. Govind Raj, Vice President for Retail and Marketing of Tanishq, while maintaining that their jewellery sales ($500 million – Dh1838 million -- last year) have gone up following the release of the movie, declined to talk actual numbers. “Small replicas of the jewellery are selling quite fast after Aishwarya and Hrithik wore them in the hit movie,'' he said.
The actual jewellery used in the movie, however, is now being exhibited and will probably be auctioned off after some time, he said.
Eight specialists took 11 months to breathe life into the magnificent gem-encrusted, 3.5-feet long sword wielded by Hrithik Roshan who played Akbar in the movie.