A study commissioned by the Indian government and a prominent human rights body suggests it is not. The Indian Institute of Management says saffron has the potential to raise the value of the national currency, currently worth Rs 1,100. But in fact, gold is more valuable because it is an indicator of wealth rather than a commodity, says the institute.
Gold is valued based on its value as a “good omen”. Gold jewellery and jewellery grade 1a, which are found in the highest quality gold and jewellery grades, have a market price on the global markets of around $1,100, though the value of gold in the region is much lower at around $350, the institute says.
In comparison, saffron is used for religious purposes because it has medicinal uses, says the report, titled ‘Gold and Indian Culture’.
On paper, gold accounts for about 18% of the total reserve stock of the Indian currency, which is in the range of 10% to 15% of the total currency valuation. “The reserve is based on the economic growth and the economic growth of the country,” says B.S. Nair, an economic advisor to the Centre for Economics and Management (CEM), which commissioned the study.
The CEM has suggested that some of the reserve amount to a national security asset if the government invests in the reserve fund, if there is a need to strengthen the cash reserves. Also, the value of the reserves will be affected if the country is required to print new currency.
“Gold has a lot of different uses and it’s not being put to use for the public good,” Nair said. “Gold is simply used by some to show their wealth. For me, saffron isn’t as important as gold. Gold is only important for the people that are wearing gold or that are rich or rich families,” said Nair.
In the last one year alone, India has spent more than Rs. 1 lakh crore on gold. Of this, Rs. 1,000 crore was spent on import by the government. India is a net exporter of gold, exporting only a couple of percent of the gold that it produces. The rest goes to foreign countries.
Nair adds that saffron was once considered gold-loving and part of the Indian culture, but is now considered as pure luxury, a commodity and a symbol.
Nair says that a large number of politicians and businessmen are against the use
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