Sunday, May 18, 2014

What will Narendra Modi's incoming government in India mean for the Gold Market?

From Al Jazeera English

Narendra Modi speaking at the Bombay Bullion Association summit on 5 Oct 2013:

Modi said gold has always been closely connected with human civilisations in the world.

"We have not seen gold just as money, it is related with all aspects of our social life. We have always attached the term 'gold' with anything good in our life," he said, adding that it was used even in Ayurvedic medicines since ages.

"In our society, gold is connected with security, respect and a friend in need during hours of crisis. It is also related to the well-being of our daughters through exchange of the matter during marriage times," he said.

"After a doctor, the goldsmith is the most trusted man in the family."

On the Gold Control Act

Modi said it is debatable how much successful the act was to preserve gold, but it seriously hit two generations of goldsmiths. "They shifted to some other profession and the skill which was honed over ages was lost," he said, adding that the country suffered a huge loss.

"Rise of gold-smuggling" The gold-smuggling activity increased during the time of the Gold Control Act. "These gangs became rich and they started to put their Money in other professions. Our film industry is an example. A class of rich goons was established and they posed serious threat to the ordinary people's lives," he said. "Could anyone imagine how the gold act put the social life under threat?." he asked.

"You must have noticed how people have been caught at airports while carrying golds in recent times. It means again the gold-smuggling activity is increasing," he said. "If narcotics, arms, fake currency and easily marketable gold are being smuggled into the country, then we can understand the danger the country is facing," Modi said.

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