India’s jewellers are facing higher compliance costs in the run-up to the festive and wedding season after the Bureau of Indian Standards (BIS) raised the gold hallmarking fee by 67% to ₹75 per article from ₹45 on 14 September.
The increase comes as elevated gold prices have pushed consumers towards lighter jewellery and exchanges, making the flat per-article fee more significant for lower-value pieces and adding to costs for retailers that absorb the charge rather than pass it on to customers.
Amit Modak, chief executive and director of Reva Diamonds by P.N. Gadgil & Sons Ltd, said the additional cost would become meaningful at scale for a retailer that hallmarks a large number of articles.
“The ₹30 increase per article may appear small in isolation, but when multiplied across the large number of articles that an organized retailer hallmarks, it becomes a meaningful incremental cost,” said Modak.
The impact is more pronounced for lightweight jewellery because the same fee applies regardless of weight. Small earrings, rings and pendants have become increasingly relevant as consumers adjust to higher gold prices.
“A lower fee slab for articles below a certain weight could help address the disproportionate impact on small earrings, rings and pendants,” Modak said, adding that the BIS, industry, and other stakeholders should decide the threshold through consultation.
Supriya Kataria, founder of Mumbai-based Kumari Fine Jewellery, said her company would charge customers the notified fee at actuals, without adding a margin.
“Hallmarking is a statutory consumer protection fee that directly assures purity and HUID traceability,” Kataria said, adding that the company’s bulk consignments help optimize the effective per-piece cost.
Darshan Chauhan, chief growth officer and executive director of Sky Gold & Diamonds, also expects limited impact. The company said the revised fee follows its existing billing mechanism through retail partners and would not materially change its operating cost structure. Even for jewellery priced at around ₹5,000-10,000, the additional ₹30 represents a small proportion of the purchase value, Chauhan said.
The increase has nevertheless raised concerns among industry representatives about how the charge is collected and its effect on the customer experience.
“The amount is not very big. But the customer refuses it. The customer argues, ‘I have taken such a big order. Why are you talking about ₹35 or ₹40?’” said Rajesh Rokde, an industry representative at the All India Gem and Jewellery Domestic Council.
Rokde said jewellers face the difficulty of explaining the charge to customers, even though the statutory fee is small compared with the value of a jewellery purchase.
“The customer is already unable to buy because gold is expensive. Secondly, making charges are added to it. Thirdly, GST (goods and services tax) is added to it. Fourthly, hallmark charges have been added to it,” he said.
He also said the industry had not been adequately consulted on the increase and called for a review of the fee. “As a government body, they should meet all the associations. Because, after all, only the jeweller will do the collection.” The earlier ₹45 fee was already high, and a lower rate could be considered, he added.
High gold prices— ₹1,57,860 per 10 grams of 24-carat gold on Friday, up nearly 17% since 1 January—are already pushing consumers towards lighter-weight, lower-carat and studded jewellery, while exchanges have emerged as an important source of demand.
In a 30 July report, the World Gold Council said jewellery demand weakened from mid-May to mid-June as “the month-long inauspicious period (mid-May to mid-June), the 9% import duty hike, and the Prime Minister’s appeal to curb gold purchases weighed on demand.”
Jewellery demand fell 15% year-on-year to 75 tonnes in the June quarter, although it recovered 14% sequentially from a weak first quarter.
“Volume of the gold jewellery retail sector (in India) will decline 13-15% on year to 620-640 tonnes this fiscal, a level not seen in the past decade,” said Himank Sharma, director, credit rating agency Crisil, in a 22 May report.
Amid this shift, a ₹75 charge represents a larger proportion of the value of a small earring or pendant than a heavier piece, even though both attract the same statutory fee.
According to the BIS’s latest notification, gold hallmarking is compulsory in 392 districts, and is being implemented in phases in the 800+ districts.
Mint‘s queries emailed to the BIS remained unanswered.
Rokde also raised concerns about uneven coverage of mandatory hallmarking across districts, saying differences in implementation could create confusion for customers.
He also raised concerns about fake hallmarking, arguing that higher compliance costs could increase the incentive for malpractice.
More stakeholders are awaiting clarity on rules. “We are waiting for clarity on the new rules as we have seen some jewellers are unhappy with the higher charges,” said a Mumbai-based hallmarking laboratory on the condition of anonymity.
Assaying and Hallmarking Centres (AHCs) are independent, third-party laboratories recognized by the BIS to scientifically test the purity of precious metals and apply hallmarks.
He said the number of AHCs is not evenly distributed across the country and is instead concentrated in major cities, reducing accessibility for small regional jewellers.
