Nilesh Shah, a part-time member of the Economic Advisory Council to the PM, has stated that India could have achieved Prime Minister Narendra Modi’s $5 trillion GDP target “long before” if it were not for the habit of importing gold. Mr. Shah, a mutual fund industry veteran, said that in the last 21 years, Indians have spent around $500 billion on gold imports alone.
According to Mr. Shah, the nation is working towards achieving the PM’s $5 trillion GDP target. However, had the habit of importing gold not been prevalent, we would have become a $5 trillion economy much earlier. He cited official data stating that Indians have spent $375 billion on gold imports on a net basis in the last 21 years. He also pointed out rampant smuggling of gold evidenced by Customs’ gold seizures on a regular basis.
Furthermore, Mr. Shah highlighted that people come back with gold jewellery from destinations like Dubai and successfully walk out of the Green Channel at the port of landing without any issues. He emphasized that if the money traditionally invested in gold had been invested in Indian entrepreneurs like the Tatas, Ambanis, Birlas, Wadia, and Adani, India’s GDP growth and per capita GDP could have been significantly higher.
In conclusion, Nilesh Shah believes that India has lost significant potential for economic growth due to its dependence on importing gold over investing in domestic industries and entrepreneurs.