By Rusha Thapa

Bhaktapur – On Thursday, August 6 (Shrawan 21), the price of gold in Nepal reached NPR 296,000 per tola, while silver climbed to NPR 4,570 per tola. The Federation responsible for setting precious metal prices determines the official rates. The labor charge for making gold jewelry is NPR 45,000 per tola, while for silver it is NPR 1,500. Including labor costs, the total price reaches approximately NPR 341,000 per tola for gold and NPR 6,000 per tola for silver.

Last Magh, gold had climbed to NPR 339,300 per tola, and with labor charges the total cost approached NPR 400,000. Silver reached NPR 8,670 per tola, costing nearly NPR 10,000 with labor. At that time, rumors circulated that gold would soon reach NPR 500,000 per tola and silver NPR 15,000. However, prices have steadily declined since then. Gold dropped as low as NPR 238,000 per tola, while silver fell to around NPR 4,000.

When prices surged in Magh, many people invested in gold and silver after traders predicted further increases. Ordinary citizens invested their savings or even borrowed money in hopes of making profits. Those who bought gold at nearly NPR 400,000 per tola expecting it to hit NPR 500,000 now regret their decision. Likewise, people who purchased silver at around NPR 10,000 per tola hoping it would reach NPR 15,000 are also disappointed.

Those who borrowed money to invest in precious metals are now under significant financial stress. Many are willing to sell their gold and silver at a loss simply to repay their loans. On Thursday, this situation was evident at many jewelry shops across the Kathmandu Valley. Large crowds gathered outside stores, not to buy, but to sell.

People who had purchased gold for nearly NPR 400,000 per tola are now ready to sell it for NPR 296,000. Silver owners are also willing to sell at around NPR 4,500 per tola. However, many jewelry shop owners are reportedly refusing to buy.

According to customers, traders had earlier assured them that they would always buy gold whenever customers wanted to sell. But now, despite repeated visits, many sellers claim they are turned away with the excuse that the shops have no money. At the same time, traders are accused of purchasing cheaper gold whenever they find a bargain, including allegedly buying smuggled or stolen gold at discounted prices. They are also accused of exploiting desperate sellers by purchasing gold worth NPR 300,000 for only NPR 50,000 to NPR 80,000.

Another concern raised is that many jewelry businesses do not issue VAT invoices when buying or selling gold. Customers also often avoid asking for bills because invoices would reveal the actual purchase or selling price.

The article further claims that many jewelry shops operate without proper business registration or PAN numbers. Although many have CCTV cameras installed, questions are raised about whether they obtained the necessary government approval for surveillance systems or installed them without authorization.

The writer argues that gold has increasingly become a means of hiding illicit wealth. Money obtained through corruption, tax evasion, or other illegal activities is allegedly being invested in gold and silver because ownership is not officially registered. According to the article, the government has no accurate records of how much gold exists in the country, who owns it, when it was purchased, for what purpose, or with what source of income. This lack of oversight is said to benefit corrupt individuals and tax evaders while depriving the state of revenue.

The author proposes that the government should require mandatory registration of all gold, silver, and jewelry with state authorities. Records should include ownership, purchase details, source of funds, and purpose of acquisition. The article also suggests imposing taxes on the ownership of precious metals.

The article further claims that Prime Minister Balen Shah possesses 190 tolas of gold and argues that the government should begin investigating the source of assets of top officials, including members of the Cabinet. No evidence is presented within the article to support this specific claim.

The article notes that in 1965 (B.S. 2022), gold reportedly cost only NPR 80 per tola, while silver was so inexpensive that older generations say it was rarely traded.

It argues that although gold and silver are luxury assets, individuals, banks, and financial institutions have invested billions of rupees in them. Many people invested their lifetime savings or borrowed at high interest rates to purchase gold, while banks issued large loans using gold as collateral. With falling prices, both individual investors and financial institutions are now facing financial pressure.

The author also argues that excessive investment in luxury assets such as gold, real estate, vehicles, and shares has contributed to Nepal's economic difficulties. The government is criticized for failing to regulate these sectors or investigate the sources of investment, increasing the risk of money laundering.

The article links these issues to Nepal's placement on the Financial Action Task Force (FATF) Grey List, warning that failure to address money laundering concerns could result in blacklisting. It argues that stricter monitoring of investments in gold, property, vehicles, shares, and cooperatives is necessary, along with stronger action against corruption and tax evasion.

Finally, the article criticizes the government for allegedly moving in the opposite direction by easing investment restrictions and withdrawing legal cases. It concludes by calling for immediate action to investigate the source of wealth, nationalize unexplained assets, and prosecute those involved in corruption and tax evasion, warning that failure to act could expose Nepal to serious economic risks.