for purchase of gold.
Addressing the annual banking conference in Pune last Saturday, another deputy governor Subir Gokarn had said there was an urgent need to "dematerialise" gold like any other financial product, which could help reduce physical imports of the precious metal that is in turn leading to the current macroeconomic stress.
"High gold import is creating some macroeconomic stresses and so the challenge is to find ways to replicate the financial characteristics of gold without necessarily causing physically importing," Gokarn had said.
Gokarn had also said an RBI working group head by KUB Rao would shortly submit a report on the ways to deal with the problem arising from high gold imports on the macroeconomic front in the from of balance of payments.
Gokarn had said while global gold output has stayed stable at around 4,000 tonne per year, domestic consumption has doubled to 1,000 tonne annually since 1999, despite a massive rally in the prices.
Last fiscal there was a 39 percent rise in gold imports and in gross terms, constituting 80 percent of the CAD of 4.2 percent of GDP. Net gold import constituted 1.8-2.4 percent of GDP.