.....The RBI’s K.U.B. Rao committee is examining how to mutate gold properties into financial savings instruments. While inflation kills the value of all financial instruments, those for gold retain their value. So the key element to build into the gold-backed papers will be inflation indexing. Successive governments have asked the RBI to independently consider this suggestion, but the bank has been reluctant so far.........
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1 comment:
It is sad that there is no perceivable effort from the government’s side to discourage further accumulation of ‘ornament gold’ in households which is partly responsible for financial loss to middle class families in India and to some extent, dowry-related issues and security problems.
Government should take some bold initiatives like commissioning a survey of domestic and institutional gold stock to bring the domestic gold stock to the mainstream which will reduce the pressure on import.
One way to get over the present rise in import not commensurate with the export of gold products is to link the quantum of import to the previous few years’ export record. Import of gold for pharmaceutical and other essential purposes could be outside such limits.
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