I don’t know whether or not it can be worth twice as much or twice as little, but I guess it is worth a lot, and that’s all it really matters.”
A few hours later, the news of the saffron sale made headlines around the world. The deal made India’s highest-ever deal for saffron, and it became a symbol of India’s cultural influence. But now the price of saffron has soared; the market value of the commodity is now estimated to exceed three billion US dollars.
On Thursday, the Central Reserve Bank of India, which controls the supply of the commodity, announced it was “considering the possible introduction of a limit on the supply of saffron.”
In a country where most people believe wealth comes from God rather than hard work, an apparent change in government policy is sparking fierce debates among economists. “If India can’t sell saffron, who will?” asks Gomkar. “We don’t need it. India makes a living by producing gold, as do much of the emerging economies and in fact the biggest exporters of gold. But the money it earns goes to the Central government and not to its citizens. Gold will be a drain on India’s economy.”
Gomkar, however, dismisses the idea of limiting the supply, asserting that India already sells large amounts of the commodity. But Gomkar says he has had several discussions with the government and that, “There are other people in India who will be happy to get the saffron but won’t want to take the risk.”
But Gomkar is also concerned that the government will not have any control over the growing demand for saffron and, ultimately, there will be a drop in production. Gomkar is confident the government will find a solution to protect saffron’s supply, but he is also concerned that the “sell-off” for saffron might hurt its reputation. “People are always worried about the perception of the saffron business. That’s why the government seems so reluctant to discuss limiting the supply,” he says.
And there are others who believe the government does not want anything to do with saffron. “There is an increasing view in the government that saffron is a bad thing,” says the former chairman of the Centre for Materials and Technology, Dr Pradip Banerjee. “The government will never compromise on its principles, especially in this case.”