One of the biggest gold plants in Dubai is now under construction. This will help to modify the international gold industry when finished next year.
The $60 million refinery being built by Kaloti Precious Metals in Dubai is part of efforts to change that pattern, as is a plan by the Dubai Gold and Commodities Exchange to introduce a spot gold contract this June.
The Dubai Multi Commodities Centre said, gold imports and exports operated by Dubai shot up to $75 billion in 2014 from $6 billion in 2003, almost 40% of the world’s physical gold business passed through Dubai last year.
The project is a gamble that gold demand in Asia will robustly strengthen in coming years. Kaloti started out selling foodstuffs to the local armed forces and trading non-ferrous scrap metal in Dubai. His international business now contains carpet manufacturing, real estate development and other productions.
Dubai’s drive to increase exchange-based trading may be as essential to its expansion as a gold centre as enlargement of its refining capacity. The Dubai Gold and Commodities Exchange which at this time deals gold futures in April, it was noted that it would bring in a spot gold contract this coming June.
Developing into a top centre for exchange-based spot trading of gold would necessitate Dubai to enlarge its infrastructure in new ways. As an example, it might need to host considerable operations of gold banks which are savings banks that function as wholesale dealers to the marketplace.
Dubai will aspire for the distribution of physical gold in two days after a business, considerably faster than delivery times seen in New York.