Open menu Close menu Menu
Open charts menu Close charts menu Charts

For help and advice call us on:

0121 369 3000

8am to 10pm - 7 days a week

£ $
Live Metal Prices
Metal Ounce Gram
Gold £1,310.51 £42.13
Silver £19.662 £0.632
Platinum £902.25 £29.01
Palladium £2,105.00 £67.68

Updated 20:46 08/05/21

The Only Way to Stop Indians Buying Gold? Take Away Their Cash

By Duncan Richardson, News Editor

15 Mar 2017

It appears the only way to stop Indian gold demand is to confiscate their cash. Prime Minister Modi has spent most of his time in government trying to stem gold demand and convince the population to deposit their bullion in one of the country's banks.

Firstly, the government hiked import taxes on the yellow metal and more recently offered interest if Indians deposited their bullion. The import tax hurt refiners and manufacturers and smuggling soared. The deposit programme failed spectacularly with only 14 tonnes being deposited out of the estimated 20,000 tonnes owned by the Indian population.

However, removing notes from circulation appears to have worked. In November, the government announced the removal of all 500 and 1,000 rupee notes from circulation in attempt to cut fraud and terrorism. The demonetisation had the desired effect as gold consumption fell to 676 tons, the lowest since 2009.

Industry insiders believe that the demonetisation was a planned attack to alleviate stress in the physical gold market. Reports have confirmed that the world’s leading refiners are working flat out to convert western gold into 1 kilo gold bars demanded by Asian customers.

comments powered by Disqus