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India's GMS 'Must Pay Gold' Says Richest Temple

Gold monetisation scheme draws 3 tonnes from TTD as jewelers extend strike...
INDIA's Gold Monetisation Scheme – aimed at unlocking existing gold holdings to meet future demand and so ease pressure on the country's import bill – should pay interest in gold, not cash, the country's richest temple has said.
Administrators of Hindu temple Tirupati Balaji, near Chennai in the south-eastern state of Andhra Pradesh, intend to double this month's 1.5-tonne deposit in the coming weeks.
But they believe that paying the low rate of interest offered on 5- to 15-year deposits in bullion, rather than cash, would make the scheme "attractive for all the temples in the country," they told the Reuters news-wire Wednesday.
"Seeking divine blessings, devotees have offered billions of dollars worth of jewelry, bars and coins to temples over the centuries," notes news-site First Post.
Launching the Gold Monetisation Scheme last November, "The government hopes it will gather 50 tonnes of gold," reports The Economist, a London-based weekly news magazine – "a modest target given the country's [estimated] 20,000-tonne pile.
"Yet four months in only three tonnes have been gathered."
India imports some 800-900 tonnes of gold annually, vying with China as the world's No.1 consumer market, but with a deeper history as "the sink of the world" for bullion since ancient times.
That inflow jumped as world prices fell hard in spring 2013, leading the then-Congress Party government first to raise import duty to 10%, and then to impose a de facto ban on new imports, since rescinded under the avowedly pro-business BJP government of Narendra Modi elected in 2014.
Last month Modi's finance minister, Arun Jaitley, disappointed India's huge jewelry industry – thought to employ perhaps 1.8 million people – by not only leaving the 10% duty in place, but also raising the rate on semi-refined doré imports, and then imposing a further 1% excise duty on the final sale of gold to consumers.
Previously split over protesting against I.D. requirements for purchases above Rs 2 lakh (200,000 Rupees, around $3,000) the industry's two main trade associations both called an indefinite strike the next day, suspending action when the government said it would not "harrass" jewellers to get their customers' data.
Now the GJF has recommenced its action after the Finance Ministry repeated that it will not "rollback" the new excise duty as asked.
Jewelers in the Sarafa Bazaar in Indore, central India, yesterday held a funeral procession for their industry, telling The Times of India that they have sent the keys from 40 jewelry shops to the government "and asked them to take over the business as we are unable to run under these circumstances."
February's jump in world gold prices saw imports to India fall 60% from the first month of the year, falling to the lowest level on record according to the Platts news and data service.

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