Gold: The best possible liquid investment, finds RBI

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Finance Minister P Chidambaram does not give up easily. With gold, probably he did. Many gold enthusiasts feared a further increase in taxes on the precious metal with the minister holding it responsible for the worsening external trade balance. Is there a change of heart when it comes to gold? It may be affecting the trade balance, but empirical study shows it is the foundation of entrepreneurship of millions. In fact, the Reserve Bank of India, which was beginning to take a tough stance on lending against gold, has been turning kind to the business.

After a knee-jerk reaction to rising stock prices, assets and liabilities of nonbanking finance companies (NBFCs), the central bank's working group had concluded that gold could turn out to be the best collateral even for banks. Indeed, it went to the extent of making gold a vehicle for financial inclusion.


 sardar singh
                                                                                 pgdm 2nd sem