India Must Tap Household, Temple Gold to Reduce Imports

Attempts by the Indian government to dampen demand for gold will be proven futile--and countervailing.

http://www.bloomberg.com/news/2012-12-11/india-must-tap-household-temple-gold-to-reduce-imports.html

“The only way India can reduce its dependence on imports is to tap the gold lying with individuals and temples,” Kishore Narne, head of commodity and currency at Motilal Oswal Commodity Broker Pvt., said in a phone interview. “By doing this, the country can reduce influx of gold at these high prices. Appetite for gold is never going to diminish.”

"Even if the depositors bring in unaccounted gold, the government should not ask them about the source,” the federation’s Bamalwa said. “Indians will continue spending on gold on marriages and in festivals. In a country like India, there is no scheme for social security, and investment in gold is like a social security."