Government goes after gold

A facile but rather misguided diagnosis for India’s rising current account deficit (CAD) is to lay the blame on gold imports. It is, of course, an attractive proposition. In fiscal 2011, gold imports were responsible for roughly half the CAD of $21 billion, amounting to roughly 1.2% of gross domestic product (GDP). Barely two years later, finance minister P. Chidambaram repeated this assertion on Wednesday.

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