India could have achieved Prime Minister Narendra Modi's dream of a USD 5 trillion GDP target "long before" if not for the habit of importing gold, a member of his economic advisory team said on Monday.
Mutual fund industry veteran Nilesh Shah, a part-time member of the Economic Advisory Council to the PM (EACPM), said that in the last 21 years, Indians have spent around USD 500 billion on gold imports alone.
"We are working towards achieving the PM's USD 5 trillion GDP target. But by avoiding this just one habit, we would have become a USD 5 trillion economy long before. We have probably lost one-third of India's GDP by simply not following the right financial investment," the MD and chief executive of Kotak Asset Management Company said.
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Citing official data, Shah said Indians have spent USD 375 billion on gold imports on a net basis in the last 21 years and added that we keep reading about Customs' gold seizures on a regular basis, which makes it evident that smuggling is rampant.
Moreover, people come back with gold jewellery from destinations like Dubai and successfully walk out of the Green Channel at the port of landing, he noted.
"Instead of investing in gold, if that money was invested in our golden entrepreneurs like the Tatas, Ambanis, Birlas, Wadia and Adani, imagine what would have been our GDP? What would have been growth, what would have been our per capita GDP?" he said.
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