Union Budget 2012-13 has not brought much cheer to the gold refining industry which is reeling under low capacity utilisation. There are 15 gold refiners in India and the total capacity of these refineries is around 600 tonne.

At present, the refineries are operating at 15-20% capacity and their margins have gone down drastically over the years. Harmesh Arora, managing director of NIBL Bullion, said: "The basic customs duty on gold ore/concentrate and dore bars meant for refining has been increased from 1% to 2%. This will affect our industry. If scrap (old jewellery) from households comes into market, we can refine them. The removal of 1% excise duty on gold coins may provide some work for us."

Gold dore is a bar of semi-purified gold. After being mined, the first stage in the purification of gold ore produces a cast bar (gold dore) that is approximately 90% gold.