Undocumented gold market to face scrutiny

Pakistan may come under the radar of the Financial Action Task Force (FATF) due to failure to regulate its gold market as 90% of the metal is still traded without formal channels. Undocumented trade and the smuggling of gold dominate the Pakistani market. FATF had urged Islamabad to regulate its bullion market but the bulk of gold is traded outside of formal channels while the gold association sets prices, though no price mechanism exists. A majority of gold dealers are not registered with the Securities and Exchange Commission of Pakistan (SECP). The Competition Commission of Pakistan (CCP) has highlighted the grey area in gold trade. It said that annual consumption of gold in Pakistan was estimated at 60 to 90 tons and proposed to the government to establish a separate authority to monitor and document bullion trade.