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India Goes Crazy for Gold
By World Coin News
June 2007

Gold “coin” enterprises appear to be cropping up all over India. The Gold Club of Chennai, Union Bank of India, and even the ICICI Bank (formerly the Industrial Credit and Investment Corporation of India) are each involved in their own independent projects. The term “coin” is being used rather loosely, but unlike in the United States there is no truth in advertising law through which the words “coin” and “medal” can necessarily denote something different.

The Gold Club of Chennai recently released what it calls “24-carat gold coins” in denominations ranging from one gram to 10 grams. The GCC coins are available through jewelry outlets owned by members of the club.

According to a recent issue of The Hindu newspaper, “The coins, once purchased, can later be exchanged for gold or money (at the price of gold prevalent on that particular day) in any of the close-to 200 members’ showrooms in Tamil Nadu and Puducherry.”

GCC Chairman N. Anantha Padmanaban has gone as far as to ask the local state government for permission to conduct an Akshaya Tritiya’ Day or mega gold festival in the future (Akshaya Tritiya’ fell on April 19 and 20 in 2007). A similar event held during 2006 realized sales estimated at 38 metric tons of gold.

Also active in the Indian gold market is the Union Bank of India, a public-sector lender based in Mumbai that plans to go into the bullion and gold coin business as well.

UBI’s General Manager for Treasury and International Banking Bhaskar Sen was quoted in the April 11 The Economic Times newspaper as saying, “The business potential in gold is huge and we aim to tap this potential.”

UBI has sold 90 metric tons of gold bullion since it entered the bullion business during 2002. The bank entered the gold coin business in October 2006, offering what it describes as coins in weights of 5, 8, 10 and 20 grams. None were available for inspection in time for this article. The bank did not provide information regarding denomination values, which would be necessary if the issue is truly coinage rather than medallions, however it was learned the coins are imported from the private concern Pamps in Switzerland.

This doesn’t stop the bank from offering them as coins at 100 of the bank’s branches throughout India. Sen said of the effort, “We are in the process of identifying more branches for marketing of gold coins based on market potential.”

He added, “There are several strong players in the market and hence our pricing will be in consonance with the market.” Apparently festivals are an important event at which gold coins can be sold in India. UBI plans to market its gold coin products during the Deepavali, Akshaya Tritiya, Vishu, Baisakhi and Bihu festivals.

ICICI Bank, India’s largest home loan provider, is also joining in the gold coin marketing game. ICICI is offering gold “coins” in weights of 50, 8, 5, and 2.5 grams through its many branch offices, again the bank failing to identify coinage denominations for each item. Each of these coins depicts the goddess Lakshmi. The bank markets these items under the banner “purity, reliability, and convenience.”

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Gold Coins - India Goes Crazy for Gold

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