Don't buy gold for economy's sake, Chidambaram tells Indians

New Delhi, June 13 (IANS) Finance Minister P. Chidambaram Thursday asked people to resist the temptation of buying gold for the sake of the health of the Indian economy.

"I once again appeal to everyone to resist the temptation to buy gold. This will show positive impact on every aspect of Indian economy," he said, addressing a news conference here.

The finance minister said reduction in gold imports would have a big positive impact on vital macro-economic indicators, especially the current account deficit, trade deficit and inflation.

"People think that they are buying gold in rupees, actually they are buying gold in dollars... If for one year there are no gold imports, it will change the current account deficit story of the country," Chidambaram said.

The monthly average gold import in the current fiscal was 152 tonnes as against 70 tonnes in 2012-13. The foreign currency outgo on gold import is estimated at $15 billion in the first two months of 2013-14.

Also, Chidambaram said, it would be wrong to believe that gold was the safest investment option. "To say that gold is the safest investment is wrong."

There were several attractive options and the informed investors were putting their money in them, he said.

Referring to the recent slump in gold prices, Chidambaram said those people who have invested in gold recent months have suffered huge losses.

However, the finance minister ruled out the possibility of any further hike in duty to curb gold imports.

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