Comments:
The editorial reads well and has conveyed the message clearly to the Govt by stating that the policy makers sought to address the sysmptom andnot the cause.The attraction for gold is basically tomake better return and cover up the loss on account of inflation.Further investment of black money in gold is more safe and convenient Aslong as there are no restrictions onCash payments to acquire gold evading sales tax and other taxes,the demand for gold would continue to be inelastic to price rise and the govt's present approach may not yield any positive result.The Govt instead of increasing the customs duty, should track the source of demand for gold and take some preventive steps to accummulate gold both by individuals and instituitions.Just by insisting for payments through cheques and cards withPAN card details,the transactions can be easily tracked.Further reporting of transactions by the dealers in Gold to some centralised authorities would have some positive impact to contain demand.
Dr.T.V.Gopalakrishnan
(This comment appeared in Business Line in response to their editorial precious little logic on 23/1/12)
The editorial reads well and has conveyed the message clearly to the Govt by stating that the policy makers sought to address the sysmptom andnot the cause.The attraction for gold is basically tomake better return and cover up the loss on account of inflation.Further investment of black money in gold is more safe and convenient Aslong as there are no restrictions onCash payments to acquire gold evading sales tax and other taxes,the demand for gold would continue to be inelastic to price rise and the govt's present approach may not yield any positive result.The Govt instead of increasing the customs duty, should track the source of demand for gold and take some preventive steps to accummulate gold both by individuals and instituitions.Just by insisting for payments through cheques and cards withPAN card details,the transactions can be easily tracked.Further reporting of transactions by the dealers in Gold to some centralised authorities would have some positive impact to contain demand.
Dr.T.V.Gopalakrishnan
(This comment appeared in Business Line in response to their editorial precious little logic on 23/1/12)
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