PM Says Skip Gold: What Should You Buy Instead?

PM Modi urged Indians to avoid buying gold unless necessary and support local manufacturing. Here's what that means for your savings strategy — and which alternatives actually grow your wealth.

Here's what happened: PM Modi publicly urged citizens to avoid buying physical gold unless essential, framing it as a matter of national self-reliance and economic discipline.. India is one of the world's largest gold importers, and the gold import bill is a major contributor to the current account deficit, which pressures the rupee.. Modi's remarks came alongside a push for Swadeshi consumption and support for domestic manufacturing, which drove strong Q1 GDP growth this year..

What you should do: Switch any planned gold jewellery purchase to Sovereign Gold Bonds (SGBs) — you get gold price returns plus 2.5% annual interest, with no making charges or storage risk.. Check if your portfolio has more than 10% in physical gold; if yes, consider rebalancing toward equity mutual funds or SGBs for better long-term wealth creation.. Before gifting gold jewellery this wedding season, compare the cost vs gifting an SGB — the recipient gets the same value but keeps earning interest for up to 8 years..

SGB capital gains at maturity (after 8 years) are completely tax-free — no LTCG, no indexation needed. Physical gold sold after 3 years still attracts 12.5% LTCG tax.