The Competition Commission of Pakistan (CCP) on Wednesday released its maiden Competition Assessment Study of the Gold Market in Pakistan, providing evidence-based analysis of the sector’s structure, regulatory landscape, and competitiveness challenges.
The study, conducted by the CCP’s Center of Excellence in Competition Law, maps a market historically dominated by informality, fragmented oversight, and pricing opacity.
According to the report, Pakistan’s annual gold consumption ranges between 60 to 90 tons, driven largely by cultural demand, while over 90% of gold trading occurs outside formal channels. The market relies almost entirely on imports, with $17 million worth of gold imported in FY2023-24. The study highlights the transformative potential of the Reko Diq copper-gold project, expected to generate up to $74 billion over its 37-year lifecycle and significantly reshape domestic supply chains.
The report, however, identifies deep-rooted barriers that suppress competition and distort market functioning. It cities weak documentation and cash-based transactions as allowing large informal networks to set prices and influence supply. It further states that daily gold rates are largely influenced by associations rather than transparent market mechanisms.
According to the CCP, overlapping and unclear mandates of the Ministry of Commerce, Federal Board of Revenue, State Bank of Pakistan, Pakistan Gems and Jewelry Development Company, and the Trade Development Authority of Pakistan create policy inconsistencies and enforcement gaps. It also notes that complex procedures and inconsistent taxation encourage smuggling and under-invoicing.
The report states that Pakistan has negligible refining capability and inadequate assaying and hallmarking facilities, leading to widespread purity issues and weak consumer protection. Absence of reliable import, traders’ registration, sales and purity data also hampers evidence-based policymaking.
To address these challenges, the CCP has proposed a comprehensive reform package, including establishing a unified regulator to harmonize rules, licensing, imports, and Anti Money Laundering and Counter Financing Terrorism compliance. It has proposed mandatory assaying and hallmarking nationwide to ensure purity, protect consumers, and enable exports.
The report advises digital transformation of the gold value chain with blockchain-based traceability integrated with FBR’s Track and Trace system and the creation of a gold banking system, inspired by the Türkiye Gold Banking System, to mobilize household gold into the formal sector. It further proposes strengthening data governance through centralized reporting, market documentation, and scientific price-monitoring mechanisms.
The CCP has emphasized that modernizing the gold sector would boost transparency, safeguard consumers, reduce illicit trade, and unlock significant economic value, particularly as Pakistan prepares for the commercial rollout of Reko Diq.