Gold Monetisation Scheme Revival Gains Support From Jewellers

New Delhi, 27th May 2026: India’s jewellery industry is once again urging the government to revive and strengthen the Gold Monetisation Scheme (GMS), arguing that mobilising idle gold lying in households could be a more effective solution than discouraging citizens from purchasing the precious metal.

The demand comes at a time when concerns over India’s rising gold imports and pressure on foreign exchange reserves have intensified. Industry bodies say the country already possesses vast quantities of unused gold stored in homes, temples, and institutions, which could be brought into the formal economy through a revamped monetisation programme.

The call for a revival of the scheme follows recent discussions around reducing gold imports to curb foreign exchange outflows. Jewellers argue that restricting consumer demand could have unintended consequences for an industry that supports millions of artisans, craftsmen, traders, transporters, and small businesses across the country.

According to industry representatives, India remains one of the world’s largest holders of privately owned gold. Instead of importing fresh gold to meet domestic demand, they believe a well-structured monetisation framework could channel existing reserves back into circulation. Under such a system, households would be encouraged to deposit unused gold in exchange for returns, while jewellers could access the metal through formal lending channels.

Several trade bodies have proposed reforms to make the scheme more attractive and easier to use. Suggestions include higher incentives for depositors, simpler procedures, greater involvement of jewellers, and tax benefits on earnings from gold deposits. Industry leaders argue that previous versions of the scheme failed to gain widespread acceptance due to limited awareness and operational challenges.

The discussion has also extended to institutional gold holdings. Some industry groups have proposed monetising a portion of the large quantities of gold held by temple trusts, arguing that it could reduce the country’s dependence on imports while putting dormant assets to productive use.

The push comes as India’s gold market continues to evolve. While jewellery demand has softened due to record-high prices, investment demand for gold has surged, highlighting the metal’s continued importance in Indian households. Data from the World Gold Council shows that investment demand has increasingly offset weaker jewellery consumption, reflecting gold’s role as a preferred store of value during periods of economic uncertainty.

The debate has also sparked reactions online, with many users arguing that the jewellery industry supports a vast ecosystem of workers and small businesses. Others have suggested that creating a transparent and trustworthy system for depositing gold could help reduce imports while preserving consumer confidence in physical gold ownership.

As policymakers weigh options to manage imports and foreign exchange pressures, the jewellery industry maintains that mobilising the country’s existing gold reserves could offer a long-term solution, one that reduces dependence on imports without disrupting a sector that remains deeply intertwined with India’s economy and culture.