In a recent interview, Nilesh Shah, a part-time member of the Economic Advisory Council to the Prime Minister (EACPM), highlighted the impact of gold imports on India’s GDP. Shah, who is also the MD and chief executive of Kotak Asset Management Company, stated that in the last 21 years, Indians have spent around $500 billion on gold imports alone.
According to Shah, India could have achieved Prime Minister Narendra Modi’s dream of a $5 trillion GDP target “long before” if not for the habit of importing gold. He emphasized that by avoiding this habit, India would have become a $5 trillion economy much earlier.
Shah cited official data showing that Indians have spent $375 billion on gold imports on a net basis in the last 21 years. He also expressed concern about rampant smuggling of gold, as evidenced by regular reports of Customs’ gold seizures.
He went on to suggest that instead of investing in gold, if that money was invested in Indian entrepreneurs like the Tatas, Ambanis, Birlas, Wadia, and Adani, it would have had a significant impact on the country’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.