KOLKATA: An Indian household spends 8% of its daily consumption on gold jewellery and coins, which is only marginally behind medical expenses and education, according to a joint report by industry body Ficci and the World Gold Council.This startling revelation comes at a time when India's current account deficit has widened sharply to $10.1 billion, or 2.1% of GDP , in the second quarter of FY15 due to high gold imports.The report, `Why India needs a gold policy', has come out with seven key recommendations for an effective gold policy for India.Elaborating on the recommendations, Somasundaram PR, managing director, World Gold Council India, said there's a need to establish an India Gold Exchange along the lines of Shanghai Gold Exchange to ensure pricing standardisation, better transparency and enhanced demand-supply analysis.India is the second largest consumer of gold, next to China, with an annual consumption of 850-900 tonne. The report says that a gold board should be set up to manage imports, encourage exports and facilitate development of infrastructure needed to ensure that the Indian gold market functions to its maximum strength. It recommends development of accredited refineries in line with international standards, including upscaling the current domestic refineries. Somasundaram said that Indian banks should be allowed to use gold as part of their li quidity reserves which would incentivise them to introduce gold-based savings products.“There's a need to revitalise gold deposit schemes and introduce gold-backed investments and savings prod ucts,“ he said. The report stressed the need to create a more active marketing strategy for Indian handcrafted jewellery along the lines of “India-made jewellery“, like the Swiss-made watches. It also pointed out that standardisation of gold is necessary so that buyers and sellers can have faith in both the quality and price of their products.The report also assesses policies adopted in countries like Turkey and China, that have faced similar challenges and have devised public policies which have monetised the local stock of gold. The recommendations in the report, is backed by a survey conducted among 5,000 respondents across the country whose family in come varies between less than Rs 2 lakh and more than Rs 25 lakh per annum.The survey shows 77% of re spondents bought gold at least once during 2013 and more than half bought more gold last year than in the previous year. Incidentally , gold prices went up to Rs 33,000 per 10 gm as the government introduced strict import curbs and the rupee weakened against the dollar. “This data shows that India has a large appetite and therefore there's a need for a gold policy which can be effective in the long term,“ WGC's India head said.