Why in news? 

According to the World Gold Council (WGC) report  titled ‘Gold refining and recycling’, India has emerged as the fourth largest recycler in the world and the country has recycled 75 tonnes in 2021

Highlights of the report:

• China topped the global gold recycling chart as it recycled 168 tonnes of the yellow metal, followed by Italy in the second position with 80 tonnes, and the US in the third rank with 78 tonnes in 2021.
• India was ranked fourth in the list as the country recycled 75 tonnes in 2021.
• According to the WGC report, from 300 tonnes in 2013, India’s gold refining capacity increased by 1,500 tonnes (500%) in 2021.
• The gold refining landscape in the country has changed over the last decade, with the number of formal operations increasing from less than five in 2013 to 33 in 2021.

Reasons for decreasing unorganised refining

• The informal sector accounts for as much as an additional 300-500 tonnes, it is worth noting that the scale of unorganised refining has fallen, largely due to the government’s tightening of pollution regulations.
• On the other hand, tax advantages have underpinned the growth of India’s gold refining industry
• The import duty differential on dore over refined bullion has spurred the growth of organised refining in India. As a result, gold dore’s share of overall imports has risen from just 7% in 2013 to around 22% in 2021.

India’s potential

• India has potential to emerge as a competitive refining hub if the next phase of bullion market reforms promotes responsible sourcing, exports of bars and consistent supply of dore or scrap.

Concerns:

• The WGC report noted that despite being the fourth largest recycler in the world, India recycles little of its own stock of gold — about 8% of the global scrap supply.
• Recycling is driven by current gold price movements, future price expectations and the economic backdrop.

World Gold Council

• The World Gold Council (WGC) is a nonprofit association of the world’s leading gold producers.
• Headquartered in London, the WGC covers the markets which comprise about three-quarters of the world’s annual gold consumption.
• It is a market development organization for the gold industry which includes 25 members and many gold mining companies as well.

• The WGC was established to promote the use of and demand for gold through marketing, research and lobbying.