RBI mulls alternative financial instruments to gold
July 12th, 2012 - 8:13 pm ICT by IANSKolkata, July 12 (IANS) The Reserve Bank of India (RBI) is mulling floating financial instruments that mimic returns on gold to curb the current account deficit, Deputy Governor Anand Sinha said Thursday.
Gold imports have contributed substantially to India’s current account deficit (CAD), which is the difference between total imports and transfers and total exports, which widened to the highest ever level to 4.5 per cent of the gross domestic product at $21.7 billion in January-March period of 2011-12.
“Gold imports have been a very substantial part of the current account deficit. Therefore, it is being looked at what best can be done. Import is one aspect, the other aspect is that the gold that is already existing in the country can be brought out to satisfy the demand by devising financial instruments which can mimic the returns on gold,” said Sinha.
“Several proposals are there. There is a committee which is looking into all these aspects,” he told reporters on the sidelines of a programme organised by the Indian Chamber of Commerce (ICC) here.
The central bank, however, has no plan to ban gold coins, Sinha added.
- India's import of precious metals down 37 percent in Q1 - Jul 17, 2012
- India calls for integrated action to secure growth - Apr 22, 2012
- Steps soon to check fiscal, curent account deficits: Chidambaram (Lead) - Jul 11, 2012
- India inc favours investments in equities, mutual funds - Aug 27, 2012
- RBI wants government to deregulate diesel price - Jan 24, 2012
- India to target 7.5-8 percent growth in 2012-13: Pranab - Feb 23, 2012
- India's exports rose 6.71 percent to $25 bn in December - Feb 01, 2012
- India's exports drop by 5.71 percent in March - May 01, 2012
- Gold to cost more as budget proposes to increase customs duty - Mar 16, 2012
- India's exports rise by 3.2 percent in April year-on-year - May 10, 2012
- India's exports rise by 3.23 percent in April - Jun 01, 2012
- Exports held out despite slowdown but outlook cloudy (2011 in Retrospect) - Dec 25, 2011
- Highlights of Union Budget 2011-12 - Feb 28, 2011
- Financial stability panel takes up Eurozone contingency plan - Jun 14, 2012
- 'India should have more restrained fiscal deficit' - Dec 17, 2011
Tags: anand, bank of india, cad, chamber of commerce, current account deficit, deputy governor, financial instruments, gold coins, gold imports, gross domestic product, indian chamber of commerce, kolkata, proposals, reserve bank of india, sidelines, sinha