Thursday, February 28th 05:05 PM IST

No hard measures against Gold in India budget

# India budget  # silver  # CTT  # gold  

The only move to discourage people from going to gold announced in the budget is the proposal to launch bonds offering interest rates linked to inflation.

NEW DELHI(BullionStreet): World's largest gold consumer India not only refrain from any moves that could further curb gold imports but raised NRI gold quota in the union budget presented Thursday.

The gold frenzied nation held its gold import duty unchanged in the budget, defying industry expectations that it would increase rates to curb demand and rein in a record current account deficit.Traders had expected the budget to usher in a levy of 8 percent.

Giving some relief to Non Resident Indians (NRI) living in abroad, the fiance minister has raised the value of gold that can be brought home from abroad.

A male passenger can now bring gold worth 50,000 rupees without paying any duty while a women passenger can bring gold worth up to 1,00,000 for free.

The only move to discourage people from going to gold announced in the budget is the proposal to launch bonds offering interest rates linked to inflation.

The aim is to lure people who typically invest in gold as a hedge against inflation.

The governmenent also sought to draw more investors to a government-backed equity savings program, by increasing the eligibility limit to individuals with annual incomes of up to 1.2 million rupees rom one million rupees.

Analysts however said India could still raise the duty if imports do not ease in response to a January hike to 6 percent from 4 percent.

India, the world's top gold consumer, imports almost all it needs. Gold imports have already surpassed $38 billion, the forecast a year ago for the entire fiscal year to March 31, and Finance Minister P.Chidambaram has urged Indians to moderate buying to reduce pressure on the rupee currency.

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