PM Modi Launches International Bullion Exchange At Gujarat's GIFT City

Prime Minister Narendra Modi launched the India International Bullion Exchange at GIFT City, Gujarat on Friday.

"We need to prepare for larger economy. We need institutions who could bring together the past and future," the prime minister said at the event that marked the launch. "IIBX is one move in that direction."

"In the future, we will be able not only influence but also determine prices of gold," the prime minister said.

The event marked the launch of the gold exchange and India-Singapore trading link. Modi also laid the foundation stone of the International Financial Services Centre Authority's headquarters.

The IIBX in the International Financial Services Centre will allow spot trading of gold between certified jewellers, and international banks and suppliers.

"We have now 64 certified jewellers registered at the exchange," Ashok Gautam, managing director and chief executive officer at the exchange, told BQ Prime on the sidelines of the launch.

The trading will allow jewellers, banks and suppliers through registered brokers to import gold through the IFSC. On payment of customs duty, the jewellers will be able to get delivery anywhere in the country within a day, said Gautam.

Currently, IFSC has approved one-vault services and will eventually have three-vault service providers. The exchange is already in talks with global banks and refineries to set up offices in the IFSC, said Gautam. The government also allowed setting up IFSC-certified vaults at other special economic zones too, Gautam said.

The exchange will start with two bullion contracts—1 kg and 100 grams. Eventually, it will also provide silver contracts.

The launch of the bullion exchange also brings together the country's three stock exchanges—the National Stock Exchange, BSE Ltd.'s IFSC arm, and the MCX—and two clearing corporations, NSDL and CDSL, with each holding 20% stake.

The launch will reduce consignment delivery time from 30 days to T+0, reducing volatility and preventing splitting of liquidity across exchanges.