The chances are that you have not heard of Datta Phuge of Pune. His claim to fame is that he struts around wearing 6.5 kgs of gold ornaments. Recently he got a shirt stitched for himself which is embellished with a further 3.5 kgs of gold. So with his shirt on his back he packs a punch, laden with 10 kgs of gold. Since the yellow metal currently costs about Rs 28,000/- per 10 gms (a tola), it means that Phuge is strutting around wearing Rupees Twenty Eight Million, excluding incidental costs like that of his underwear and socks!
Given us Indians penchant for gold, we should elect Phuge as our President. At present his wife is only a lowly Municipal Corporator, but Phuge nurses ambitions of fighting the forthcoming Lok Sabha elections from the Shirur constituency on an NCP ticket.
Is Datta Phuge an aberration, or a symbol of modern India? Many may call Phuge a fool for strutting around like that, considering how easily hapless women are divested of their necklaces and earrings; a phenomenon that has added a new word to the English lexicon – “chain snatchers”. Yet I would hazard a guess that half of India would long to be in Phuge’s shoes, I mean shirt! Why are we Indians so obsessed with gold? It baffles me.
Even the Govt of India is worried, because gold imports, like that of oil, is a major contributor to the country’s Current Account Deficit (CAD), which loosely translates into the excess of foreign exchange outgoings over inflows. The CAD has now climbed to a worrying 5.4% of our Gross Domestic Product (GDP), thereby affecting our economic rating, contributing to inflation, and a further economic slowdown. Two years ago the Govt put the squeeze on gold, raising Customs Duty from 2% to 4%, and now to 6%. It dare not go higher for fear of encouraging smuggling. But even this limited measure has had a salutary effect. Gold imports are down from 933 tonnes in 2011 to about 800 tonnes in 2012-13. Latest figures show that gold imports have crashed from 141 tonnes in April to just 31 tonnes in June this year. This augurs well for the economy.
There are two other factors that have put the brakes on gold imports. One is Finance Minister P. Chidambaram’s directive to banks to not give loans for purchase of gold. The second is the Reserve Bank of India’s recent directive that 20% of imported gold must be exported back in the form of finished goods (gold ornaments). It thereby hopes to reduce annual gold imports to 500 tonnes, while at the same time exporting 100 tonnes of finished goods. These are wise measures that need to be acclaimed.
It is interesting to here note that the World Gold Council has stated that for the first time since 2009, the demand for gold has actually come down from a peak of 4405 tonnes in 2012. On the face of it a “poor country” like India seems to be the biggest buyer of gold worldwide. Is this not a skewered priority that needs to be rectified?
The Govt, yeah those despised “netas”, is doing its part. What of “we the people”? Is not the import and sale of gold driven by our own craze for the yellow stuff? Writing in the Hindustan Times, Gaurav Choudhury states that 50% of the gold sold in India is for wedding ornaments. And there are 15 million weddings a year. At current import levels and prices that translates into 400 tonnes, or an average of 27 gms per wedding, worth Rs 75,600/- each. In higher income groups this figure will rise astronomically. Is this not a colossal waste, just chasing a yellow mirage?
As I said earlier, the gold we wear in public is not safe. Nor is the wearer. What is the use of keeping gold ornaments in the safe anyway? Who is going to see it there, other than an insider who could be a potential thief? Do those sleeping on their gold get good sleep, or do they always have an eye open to protect their precious metal? Today artificial jewelry, and even diamonds, look as good as the original stuff. Together with wedding attire, jewelry is also available on hire. Ask any wedding planner. Who knows and who cares what you are wearing at your wedding, or any other day for that matter?
What about all those social and civic activists on Twitter and Facebook (I am neither)? They are always brimming with self-righteous anger. Why don’t these socially conscious netizens of India launch an FB and TWT campaign against gold consumption and wedding ostentation? They would be rendering a singular service to the nation.
In his article Choudhury states that earlier almost all countries, excluding the U.S., linked their currencies to the quantity of gold that they had in their coffers. It was called the Gold Standard. It was discarded after World War I, which is almost 100 years ago. If nations and their currencies could de-link themselves from gold, wouldn’t it be wonderful if individuals could also dump the “gold standard”, and become standard bearers of a different value system altogether?
I am practicing what I preach, because the only gold I possess is my slim wedding band with my wife’s name and our wedding date engraved on it. I was happy to see that the new Pope Francis has dispensed with the golden cross that his predecessors wore, as a sign of spiritual authority. It would indeed be wonderful if spiritual leaders, who wield great influence over their disciples/ devotees, were to appeal to them to eschew their passion for gold.
There are two references to gold in the Bible that I find significant. The first is the well-known presentation of gold by the wise men from the East at the time of Jesus’ birth. Have we ever wondered how much gold it was? It must have been a mere token; otherwise Jesus would not have had to spend the next 30 years working as a carpenter.
Even more poignant is the interaction of Peter and John with a lame man at the Temple, after the Resurrection. When beseeched for alms Peter said to the beggar, “Silver and gold I do not have, but what I do have I give to you: In the name of Jesus Christ of Nazareth, rise up and walk” (Acts 3:6). Would that we too could follow in the footsteps of the Carpenter of Nazareth and his devoted disciple Peter.
Giving up the glitter may seem like swallowing a bitter pill. But that is good for health; in this case the health of the economy as also of society. So why fritter away one’s precious earnings on that “not so precious” glitter? Do twitter about it.
August 2013
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