From mint · Sonali Garg,Robert E.Wright · · 1m 10s
Let Indians spend gold to ease rupee problems
India could use gold notes to stabilize rupee without RBI intervention.
In brief
India could use gold notes to stabilize rupee without RBI intervention. India could issue gold-backed notes to let citizens spend gold while keeping rupee stable. Originally reported by mint.
Gold hoarding in India
Indians buy gold on Akshaya Tritiya, Dhanteras and Diwali.
Gold reserves vs RBI
Families and temples keep about 25,000 tonnes of gold, 28 times RBI's reserves.
Government response
Prime Minister Modi asked Indians to postpone gold purchases for a year in May 2026.
Goldback solution
Goldbacks are notes with 31 milligrams of 24 carat gold, accepted by 5,000 US businesses.
Swarnmudra concept
Swarnmudra would be 8 milligrams of gold worth about ₹109, buy ₹100 vegetables with one.
Legal changes needed
Parliament could exempt swarnmudras from Section 14 of Coinage Act 2011 and tax law could treat spending as money.
Gold standard benefits
Swarnmudras would let India enjoy gold standard without RBI buying gold or pegging rupee.
Why gold is valuable
Gold jewellery has sentimental value, melting it is anathema to families.
Goldbacks vs swarnmudra
Goldbacks sell for twice gold value, premium pays for durability and anti-fraud features.
The headline
India could issue gold-backed notes to let citizens spend gold while keeping rupee stable.
