The gold business in Bangladesh is significant for both the economy and culture. Gold is connected with traditions, weddings, and festivals in Bangladesh. The demand for gold is consistently higher in Bangladesh. Holding gold is also considered a symbol of wealth and status in Bangladesh. In this blog, we will explore the dynamics of the gold business in Bangladesh.
Various types of gold are available in Bangladesh. All kinds of gold have different needs, such as daily wear or investment, and people buy gold according to their budgets, occasions, and choices.
Here are the common types of gold available in Bangladesh:
There are many types of gold business in the world. The most common gold businesses are:
a. Gold Trading and Investment
b. Gold Jewellery Business
c. Gold Buying and Selling
d. Gold Mining and Exploration
There is no gold mine in Bangladesh. So, gold bar selling is not a common scenario here. Bangladesh buys raw gold from foreign countries. The retail gold jewellery business is the main gold business in Bangladesh. Recently, buying gold as an investment has been started, but it's in a very initial state.
Many small jewellery shops throughout the country make it easy for customers to buy gold jewellery. These local jewellers and a few large retailers dominate the gold business in Bangladesh. Bangladesh's notable retail gold jewellery brands are Apan Jewellers, Al-Amin Jewellers, Amin Jewellers, Sultana Jewellers Ltd., Malabar Gold and Diamond, Gitanjali Jewellers, and Venus Jewellers Bangladesh. They have established trust and brand value over decades by selling high-quality gold jewellery.
There are many challenges for the gold industry in Bangladesh. Here are the top ones -
A high import tax on gold is a big barrier to the gold business in Bangladesh. This tax increases the price of gold in Bangladesh for regular gold jewellery consumers. High taxes also provoke smuggling and negatively impact the local market. Though recently, the tax has been lowered on gold imports in Bangladesh, the importers are not encouraged by that, and they are choosing informal means to purchase gold for extra profit.
The lack of a following gold standard or hallmarking system results in inconsistent quality. Gold jewellery consumers often have to depend on the reputation of individual jewellers.
Many gold trade in Bangladesh occurs in the unregulated informal sector. This creates a parallel economy and decreases Bangladesh's government revenue.
International gold prices significantly affect the local gold market. Geopolitical and economic factors lead to uncertainty for businesses and consumers in Bangladesh.
With many challenges, there are also many growth opportunities for the gold business in Bangladesh. Let’s see how Bangladesh can utilize some opportunities to grow the gold industry:
A nationwide hallmarking system can increase consumer trust and create a standard for quality. Though popular jewellery shops follow the hallmark system, there is still a lack of practice.
Jewellers can reach more customers, especially young people, through e-commerce platforms. Top brands in Bangladesh, like AL-AMIN JEWELLERS, are trying to sell jewellery through online platforms. Virtual try-ons are becoming popular worldwide and could be used in Bangladesh. Businesses can also use jewellery shop management software to manage gold shops properly.
Recently, Bangladesh has faced more inflation than in previous decades. People are concerned about their stable wealth value. More people are starting to see gold as a good investment to protect against inflation. Banks and other financial institutions can offer gold savings accounts or ETFs.
Bangladesh could sell more handmade jewellery to other countries by focusing on excellent craftsmanship and unique designs. Previously, Bangladesh exported a good amount of gold jewellery to a few countries: UAE, Nepal, Thailand, and Ireland. If enough government support is provided, more countries can be added to the export list in the future.
The gold business in Bangladesh is more than just buying and selling. Gold is used as a means to showcase culture and tradition in Bangladesh. Bangladesh is facing challenges like high import taxes and a lack of standardisation. However, Bangladesh's gold industry still has many opportunities to grow. Bangladesh can become a major player in the gold market by modernising, using technology, and following global standards. Bangladesh can increase the gold industry by exporting gold jewellery to the international market. As the gold industry in Bangladesh develops, it will also significantly boost the national economy.
