Saturday, January 25, 2014

Will look at lifting gold curbs on govt request, says RBI
[Editor: The UPA Government cannot continue to victimize a sector for years to cut its CAD. Moreover, will any democratic government continue to decide for years, whether its citizens should buy jewelries or not in order to save the country from the Fiscal Mess ? This will  not find logic anywhere in the world, except in Economies, where dictatorship prevails. When the livelihoods of millions of workers associated with the Gems and Jewelry sector is concerned, it is neither ethical nor economical to play with their sentiments. It is time the RBI in consultation with the present UPA government brings in some rationalization of the restrictions imposed on the import of gold, apart from putting other measures which could facilitate more exports. Or else the UPA should be ready to face music in the next general elections, which is just a few months away. It does not require mention, that P Chiadambaram's policies have already destroyed a few sectors, like Infrastructure, Power, Steel and Mines, Telecom, Auto, Real Estate, etc and this one, which is one of the biggest earners of Foreign Exchange is on the verge of collapse. If the import duty is raised so  much (from 2 % to 10%) how can Indian jewelers remain competitive in the export market? The policies should have some sense and edge, isn't it? Therefore, I feel it is not the 80:20 rule which needs to be changed immediately, but the import restrictions which are predatory in nature, apart from being counter productive]
Bangalore, Jan 25 2014: Amid clamour from various quarters that curbs on gold be relaxed, the Reserve Bank of India (RBI) on Friday said it will evaluate the proposal if and when a request comes from the government.

“Provided there is a reason, logic or if somebody is facing difficulty, we will take a view,” KC Chakrabarty, deputy governor of RBI, told reporters after a panel discussion on “Gold and its status in India” at IIM-B.

UPA chairperson Sonia Gandhi had written to the commerce ministry to look at a request by the gems and jewellery industry for a cut in gold import duty. 

The All India Gems and Jewellery Trade Federation had earlier written to Sonia, demanding reduction in import duty on gold to 2% from 10% to encourage exports and curb smuggling. It had also demanded relaxation of an RBI rule requiring that 20% of imported gold has to be exported. “We cannot be expected to act on news reports. We take actions based on our analysis and reports. It depends on what proposal we get,” Chakrabarty said. 

He said that RBI has no data on smuggling and, if it is happening, the central bank’s administrative policies should stop that or enforcement authorities should step in.

Courtesy: The Financial Express