Gold town feels price pinch

In the village of Koduvalli in India, about 130 of the 240 shops trade in jewellery, much of it gold, Daily India reports.

Historically it has been a trading centre that was vital for the gold industry in India. "Every household in Koduvalli has at least two people working in the gold industry," the secretary of the Koduvalli Gold and Silver Merchant Association explains.

Now, however, the village is coming under threat from neighbouring areas that are competing. Also, the rising price of gold has threatened business in the village.

The businessmen are now employing tracking agencies to keep an eye on the price of gold and update the merchants via their mobile phones.

The village claims to sell the purest gold in the country – merchant Adbul Karim told Daily India that "even a teenager here can identify pure gold, so we cannot afford any cheating".

The popularity of gold jewellery and other gold items in India means that the country is the world's single biggest market for the precious metal.