"Need to dissuade people from investing in gold: Pranab
Mumbai: Worried over flow of savings for investment in gold, Finance Minister Pranab Mukherjee on Saturday said there is a need to spread financial literacy to encourage people to invest in market instruments.
Pointing out that India's gold import surged to $60-62 billion in last fiscal, the Minister regretted that people are investing in gold with the expectation that the value of their investment would appreciate.
"Quantum of import of gold ... is a clear indication (that) large section of community...want (to) investment in dead asset only with expectation that value would appreciate", he said while speaking at Zee television award function.
The Minister further said "time is ripe to motivate our educated upper middle class to climb from saving mode to wealth generation mode.
"...My request to financial analysts and other experts and leaders in this field is to ensure than we can create confidence in market, spread financial literacy and merit of investment could be widely spread", he said....
While asking financial analysts and experts to educate investors, Mukherjee cautioned: "We need to put investors interest in forefront. If we loose the interest of potential investors, growth process will be stalled."
In order to check gold imports, the government has increased basic customs duty on gold bars from 2 per cent to 4 per cent."
At http://ibnlive.in.com/news/need-to-dissuade-people-from-investing-in-gold-pranab/266435-7.html
My comments:
What a load of factual tripe for the Indian Finance Minister to call gold a "dead asset" and to suggest Indian investors should replace their gold investments with paper "market instruments" because that is financial literacy.
Indian investors in physical gold have been doing very well because they have demonstrated "financial literacy" and a distrust of the long term purchasing power of paper, which devalues into nothing.
Does "financial literacy" mean replacing physical gold investments with investments in an exchange traded gold etf that doesn't have the physical gold it claims to own?
I wonder if some desperate banksters have got in the ear of the Indian Government?
