Recently government of india has doubled the import duty on gold. What impact is it likely to have on foreign exchange rate and how?
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Recently government of india has doubled the import duty on gold. What impact is it likely to have on foreign
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Answer:
Gold is the ornament metal which is more imported by our country because our supply is far lower than demand.
Explanation:
Doubled the import duty on gold effects the increase in the price of gold, it leads to reduce the gold usage. Government takes initiatives to reduce the import of gold because more foreign exchange outflow due to more import.
Gold monetization scheme is implemented by the Union government to meet the demand with our own supply (crowded out of the non-use golds) but this scheme is not as much success, gold import is continuously increasing. So government takes step to increase the import duty.
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