The gold trade in Pakistan has come to a grinding halt, sending shockwaves through the nation's bullion markets.
This suspension, which has been in effect since September 13, 2023, has left traders and buyers in a state of uncertainty.
The suspension of gold trade was ordered by law enforcement agencies in a bid to combat rampant malpractices within the bullion trade.
These illicit activities include price manipulation, smuggling, and hoarding perpetrated by various mafias and profiteers.
Smuggling push prices to alarming levels
In early September, the price of gold bars skyrocketed to a staggering Rs. 240,000 per tola, primarily due to manipulation by investors and speculators.
Simultaneously, gold was being smuggled to neighboring countries, further inflating its prices and raising concerns.
Local jewelry sales plunge
As a consequence of the exorbitant prices, the sale of gold jewelry has nearly ground to a halt in local markets.
A substantial portion of the population is feeling the squeeze of eroding purchasing power, unable to afford these costly ornaments.
The All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) has refrained from issuing gold price updates since September 13, leaving many in the dark about the market's current status.
New trading rules on horizon
The president of APSGJA, Haji Haroon Chand, offered a glimmer of hope for traders and buyers alike.
He stated, "The trade of gold is expected to resume in the coming days once the revised trading rules are defined by the authorities, which will be based on the physical trade of gold rather than the prevailing malpractice of trading on paper."
Chand continued, "The new and improvised rules of business in the bullion market will not only contain prices at a local level but also control speculations, hoarding, and smuggling of the precious metal. Furthermore, it will lead to the documentation of traders' records and investments."