a sharp surge in global bullion prices, concerns have intensified over the impact of futures trading on India’s physical gold and silver market. Gold prices touched an all-time high of Rs 1,40,200 per 10 grams, while silver was traded at Rs 2,34,200 per kilogram on Wednesday, reflecting strong bullish momentum in international markets. Raising alarm over the growing vulnerability of the retail sarafa trade, former president of the Raipur Sarafa Association Harakh Malu has written to the Prime Minister’s Office (PMO), urging the removal of gold and silver from futures trading.

 

In his letter addressed to Prime Minister Narendra Modi, Malu flagged what he described as excessive speculation, market distortion and the rising risk of money laundering linked to bullion futures. Malu stated that while the Central Government has permitted futures trading in several commodities, gold and silver trading has increasingly drifted away from its original purpose of facilitating physical delivery and price discovery.

 

Instead, he argued, futures trading in bullion has become predominantly speculative, widening the gap between spot prices and futures prices and creating instability in the physical market. He pointed out that this disconnect has intensified at a time when global gold and silver prices are witnessing a strong upward trend, compounding uncertainty for domestic traders. According to Malu, sharp and frequent price fluctuations driven by speculative activity are severely impacting small and medium bullion traders, many of whom operate on limited working capital and thin margins.

 

Highlighting the human cost of market volatility, Malu said that sustained financial losses have placed immense pressure on families dependent on the sarafa business. He noted that traders are facing mounting stress, anxiety, and social strain due to unpredictable price movements that are beyond their control. In extreme situations, he warned, prolonged losses could push individuals towards severe mental distress.

 

Malu also alleged that international entities exercising influence over futures trading are increasingly dictating prices in the physical bullion market. He cautioned that when futures prices begin to override actual demand-supply dynamics, it encourages parallel and unaccounted transactions, thereby increasing the risk of money laundering.

 

Calling for decisive intervention, Malu suggested that removing gold and silver from the futures market would help restore balance between physical and paper trading, curb speculative excesses and protect genuine traders and consumers.

 

He emphasised that such a step would provide much-needed stability to the bullion sector, especially when gold and silver are globally regarded as safe havens assets amid economic uncertainty. Appealing to the Prime Minister to view the issue from both economic and humanitarian perspectives, Malu said timely action would safeguard livelihoods across the bullion trade and bring relief to thousands of families dependent on the sector.