Page 15 - Bullion World Volume 02 Issue 08 August 2022
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Bullion World | Volume 2 | Issue 08 | August 2022
4, 2020 notified the IFSCA (Bullion IFSCA has ensured sourcing India shall act as the spokes to
Exchange) Regulations, 2020 paving integrity of the bullion delivered feed the bullion for the jewellery
the way for setting up a Bullion through IIBX by mandating manufacturers and exporters
Exchange and a Bullion Clearing compliance to OECD Due across the country, while the
Corporation by a consortium of 5 Diligence Guidance for IIBX at GIFT-IFSC will act as a
leading Indian Market Infrastructure Responsible Supply Chains of trading hub.
Institutions (MIIs). Minerals from Conflict-Affected
and High-Risk Areas. 4. Indian Bank’s branches as
India International Bullion Exchange Professional Clearing Members:
(IIBX), the maiden international 2. Import by Domestic Jeweller: The RBI through a notification
bullion exchange at GIFT-IFSC, From the Indian (DTA) on June 7, 2022 has enabled
has been set-up by a consortium perspective, the enabling of Indian Bank’s branches or
of Central Depository Services direct participation of qualified Foreign Bank’s Wholly owned
(India) Limited (CDSL), India jewellers- as notified by IFSCA, subsidiaries who branches may
INX International Exchange on IIBX for the purpose of be functional at GIFT-IFSC to
(IFSC) Limited (INDIA INX), Multi importing gold, is a major policy operate as Professional Clearing
Commodity Exchange of India reform by the Government of Members (PCMs) subject to
Limited (MCX), National Securities India and the Reserve Bank. necessary approvals by the RBI.
Depository Limited (NSDL) and For the first time in India, since
National Stock Exchange of India the liberalisation of gold imports 5. Financialisation of Gold:
Limited (NSE) under the regulatory through nominated banks and IFSCA has already provided
oversight of IFSCA. agencies in the 1990s, the a regulatory framework for
end users (eligible qualified products like Gold and Silver
IFSCA had issued detailed Operating jewellers in India) are allowed ETFs which is expected to
Guidelines for Bullion Exchange, to directly import gold through encourage participation by a
Bullion Clearing Corporation, IIBX. Our endeavour would be to variety of investors.
Bullion Depository and the Bullion provide an alternative channel of
intermediaries in an IFSC, on August import based on the benefits of For International Market participants
25, 2022. disintermediation of import. Our audience from overseas may
be interested in participating on the
Some of the highlights of the bullion 3. Vaulting facilities at IFSC: GIFT-IFSC bullion ecosystem under
ecosystem at IFSC are as under: Indian and Global vault service an ‘offshore’ regulatory framework,
providers have set up or are in within India that has a huge
1. Movement towards organised the process of setting up vaulting ready-made consumer demand
market: The state-of-the-art facilities in GIFT-IFSC which will market, that is in existence. Although
infrastructure of IIBX will offer lead to total storage capacity of India has been a key consumer of
technology-based mechanisms approximately 125 tonnes for gold, its share in the global trading
for trading, clearing and creation Gold and 1,000 tonnes for Silver. volumes is less than 0.50% currently.
of Bullion Depository Receipts Further, Ministry of Commerce
(BDRs), the security traded on and Industry has notified on The potential for leap-frogging in
IIBX which is backed by the July 6, 2022 that any unit in this aspect is immense and IFSCA
physical bullion. an SEZ -including other than recognises the various factors that
GIFT-IFSC- which is permitted to will help India move forward in this
In addition to providing a store bullion for the purpose of sector. Some of the plans, base
trading avenue to various issuance of bullion spot delivery for which is already existing in the
participants, IIBX will also contract and BDR can also be current ecosystem are:
offer the advantages of price deemed as a unit in IFSC.
discovery, transparency in 1. Foreign banks participation as
disclosures, centralised clearing Thus, the vaulting facilities at Trading & Clearing members
and assurance of quality. all the key bullion centres in on the IIBX, which has been
enabled by IFSCA.
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