In a recent interview, Nilesh Shah, a part-time member of the Economic Advisory Council to the Prime Minister (EACPM) and the MD and chief executive of Kotak Asset Management Company, discussed the impact of gold imports on India’s GDP. According to Shah, Indians have spent approximately $500 billion on gold imports in the past 21 years alone.
Shah emphasized that if not for the habit of importing gold, India could have achieved Prime Minister Narendra Modi’s dream of a $5 trillion GDP target much earlier. He cited official data showing that Indians have spent $375 billion on gold imports on a net basis in the last 21 years. Furthermore, he expressed concern about rampant smuggling of gold as evidenced by regular reports of Customs’ gold seizures.
Shah suggested investing in domestic entrepreneurs like the Tatas, Ambanis, Birlas, Wadia, and Adani instead of investing in gold. He argued that this would have had a significant impact on India’s GDP, growth, and per capita GDP.
Shah’s remarks shed light on the potential economic impact of reducing gold imports and investing in domestic entrepreneurs. His insights provide valuable considerations for India’s economic future and the achievement of Prime Minister Modi’s GDP target.