India's biggest jewellers' association has asked members to stop selling gold bars and coins, about 35 percent of their business, adding its weight to government efforts to cut gold imports and stem a swelling current account deficit.
The call by the All India Gems and Jewellery Trade Federation (AIGJTF), which represents about 90 percent of jewellers, comes just days after financial services company Reliance Capital halted sales of its gold-backed funds.
"As a responsible trade body, we have requested our retailers not to sell gold coins or bars. We need to help the government to solve the CAD (current account deficit) problem," said Haresh Soni, chairman of the AIGJTF, which has more than 40,000 members.
India is the world's biggest gold buyer, and soaring imports have sent its current account to a record deficit. New Delhi has raised the import duty on gold twice since Jan. 1, doubling it to 8 percent, and the central bank has imposed measures forcing customers to pay up front for gold.