Gold gets its sparkle back in time for India's Diwali

MUMBAI (Oct 16): Until early this month, Indian jewelers expected the traditional surge in demand from the Hindu Festival of Lights in October to be muted.

The gold industry was struggling to emerge from a slump in sales caused by a government crackdown on the black market and efforts to increase financial transparency. In August, jewelers were dealt a fresh blow by a decision to bring them under the Prevention of Money Laundering Act -- a move they likened to being bracketed with those selling arms and ammunition.

Vigorous lobbying persuaded the government to reverse the decision, freeing customers from a requirement to provide their income tax identity for every purchase above 50,000 rupees ($1,043). While the move will be reviewed after further consultations, the backtrack lifted the mood and brought a positive change in sentiment before Diwali this week, according to Metals Focus Ltd.

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