India's gold dealers deepen discounts to jewellers

Mumbai

GOLD dealers in India, the world's largest bullion market after China, have deepened discounts to jewellers by as much as seven-fold after a surge in global prices cooled demand and amid speculation the government will cut import taxes in the budget on Monday.

Reductions have widened to US$30 an ounce below London cash prices from as little as US$4 at the time of the Hindu festival of Diwali in November, said Bachhraj Bamalwa, a director at the All India Gems & Jewellery Trade Federation. These are record discounts in a market that normally trades at a premium and some dealers are giving markdowns as large as US$55 on sales without invoices, Mr Bamalwa said in Kolkata on Wednesday.