Pakistan’s Gold Market Largely Unregulated, Controlled by Associations: CCP

A large number of gold traders in Pakistan are unregistered, cash transactions are conducted to evade taxes, and groups of traders influence gold prices and supply, according to the Competition Commission of Pakistan’s assessment study on gold markets. According to the Competition Commission, due to inadequate testing facilities, issues like adulteration and consumer deception are common. Because of the undocumented market, most gold transactions are in cash; gold refining in the country is almost nonexistent; and there is no reliable data available regarding gold imports, sales, and purification. According to the report, associations in various cities determine prices daily; there is no comprehensive regulation to regulate the gold market, and there is no market mechanism in place in the country to set gold rates. The Competition Commission states that the complex tax system on gold transactions promotes smuggling and under-invoicing; without gold data, effective policymaking is not possible; and to regulate the gold market, the Competition Commission has proposed comprehensive reforms.