ISLAMABAD: The Competition Commission of Pakistan (CCP) has released an assessment study on the country’s gold market, stating therein that the country consumed between 60 to 90 tons of gold annually with more than 90 percent of trading occurring through informal channels.
The studyt also highlighted that the gold marker is largely undocumented and in opaque nature. According to the report, Pakistan’s gold imports were valued at 17 million dollars during the fiscal year 2024.
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The study also noted that the proposed Reko Diq gold project, spanning 37 years, could produce gold worth approximately 74 billion dollars and has the potential to transform the gold supply chain in the country.
Due to the informal nature of the market, most gold transactions are conducted in cash, and traders’ groups significantly influence prices and supply. Currently, there is no established market mechanism to set gold rates, with city-based associations determining daily prices.
The commission highlighted the lack of comprehensive regulations to govern the gold market. Complex taxation systems on gold transactions encourage smuggling and under-invoicing, while gold refining in Pakistan remains nearly non-existent. Insufficient hallmarking facilities also lead to adulteration and consumer deception. Reliable data on gold imports, sales, and purity is largely unavailable, making effective policymaking difficult.
To address these challenges, the Competition Commission has proposed a series of reforms, including the establishment of a Pakistan Gold and Gemstone Authority. This body would oversee licensing, imports, anti-money laundering regulations, quality testing, and grading of gold. The commission also recommends linking gold trading to the Federal Board of Revenue’s track-and-trace system and introducing a gold banking system similar to Turkey’s model.
The report emphasizes that regulatory frameworks must be implemented before the commercial launch of the Reko Diq project to ensure a well-organized and transparent gold market.
