This refers to the report “Muthoot Finance faces RBI probe on gold bonds” (June 15). It is not surprising that the recent developments in the country are making a section of the super-rich look at gold to make a quick buck.
According to an estimate, of the world’s exploited stock of 140,000 tonnes of gold, India’s holding accounts for about 10,000 to 13,000 tonnes of which about 600 tonnes are held with the Reserve Bank of India. Besides, our country imports around 800 tonnes of gold annually. However, when it comes to using this precious metal to the advantage of the nation, the story is disappointing. The practice in India is to accumulate gold as jewellery in households. The opportunity the yellow metal provides in commercial, financial and forex areas has not been fully exploited.
Last year, the Tirumala Tirupati Devasthanams (TTD) deposited 1,000 kg of gold (around one-third of its aggregate gold stock) with the State Bank of India. These deposits earn a small interest. This is a healthy move and is expected to set a trend for other temples, institutions and maybe even individuals and families
Gold should be restored to its status as a store of value by making it tradable, secure and available in “paper” form against actual stocks of pure or standard gold. If gold is assigned the status of a financial asset (which it really is), the craze for gold-plated roofs, making and remaking ornaments, hoarding for appreciation in value and other such practices will be reduced.
M G Warrier, Mumbai
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