India Needs a Daily Gold Price – Here’s the Plan
The Imperative
The establishment of an official Daily Gold Price Reference Rate for India – supported by institutional reforms in bullion markets, logistics, currency infrastructure, and strategic reserve management – is an imperative. With gold prices unusually high in international markets, India’s response must be practical, rooted in the 5,000-year perspective of bullion in our civilisation.
I. Immediate Measures
The Daily Gold Price Reference Rate needs publication by a quasi-Government agency – Financial Benchmarks India Ltd (FBIL). The Department of Economic Affairs must initiate action by constituting an ad-hoc Bharath Precious Metals Agency, which would later evolve into a Government regulator. A Cabinet Note must be moved.
II. Bullion Market Regulation
All gold loans shall be issued by registered jewellers, regulated by the India International Bullion Exchange. State-owned banks shall be authorised dealers in primary gold. All commercial banks will be allowed to deal in primary gold from a Government entity and seven nominated wholesale banks.
The Forward Markets Commission (FMC) – merged with SEBI in 2015 – must be re-established as the Bharath Products Forward Markets Commission. India currently lacks a forward market with specific delivery contracts, having leapt directly to futures and derivatives. This chasm fragments businesses instead of creating efficient neutral spaces.
III. Delivery and Transportation
Deliveries of primary gold shall be escorted only by India Post and the Railway Police. Inter-state transportation shall use unmarked vans, guarded jointly by the President’s Bodyguard and CRPF, establishing the Special Bullion and Weights & Measures Protection Service.
RBI can transfer gold reserves to Government on a FIFO basis. Up to 80 metric tonnes may be held at Rashtrapathi Bhavan by July 2027, adding 1 tonne each July 15. The President shall appoint the senior-most RBI Executive Director as Comptroller of Bullion Reserves and Keeper of the Currency Plates and Mint Dies.
IV. Reference Rate Criteria
· Gold: 24 carat international standard
· Recycled gold: BIS hallmarked in 22, 18, and 14 carat
· Delivery: Precious Metal Vaults with authorised commercial banks
· Reference Currency: INR, determined at seven levels daily based on the IMF’s SDR rate, processed within 60 minutes of publication
V. SDR Rupee
The rupee equivalent of the SDR shall use the weighted average exchange rate of currencies traded in India on the previous working day. Reference rates must be available by 9:30 am IST – physical markets are most active 10:30 am–12 pm and 3 pm–4:30 pm.
FBIL shall publish:
· SDR = INR Rate
· INR = All Currency Rates
· On a 2-hourly basis (except 1 am–7 am IST)
· In 22 Indian languages plus English
VI. International Gold Price Determination
The price shall consider:
(a) producer prices in exporting nations,
(b) transportation costs,
(c) Mangalore Airport Precious Metals facility as reference for international deliveries.
The econometric formula can be entrusted to Niti Aayog, IITs, RBI faculties, and think tanks as a matter of national interest.
VII. Data Governance
Publication shall be enabled across seven RBI-created sites. Data keying-in authority shall not be below the rank of Secretary to Government of India, Deputy Governor of RBI, or Managing Director (Bullion) at Central Bank of India. Processing will follow a gazetted protocol with subscription access.
Key Strategic Proposals
Purchase from the United States: Government of India and RBI will purchase 250 metric tonnes of mined gold from the USA. This reduces the Merchandise Trade Deficit with the US, strengthens bilateral relations, and helps insulate the INR from speculative attacks.
RBI Gold at Bank of England: This gold needs to be moved to the Bank of Japan and offered to the forward market through at least seven Indian commercial banks.
Primary Gold from RBI to Government: RBI should provide primary gold to a state-owned bank, exempt from customs duty. Profits—the difference between acquisition cost and current price—would accrue to Government.
Export-Linked Release: RBI should release gold only against jewellery exports, coordinated with the Director General of Foreign Trade.
Fluctuations Management Reserve: A reserve equivalent to ₹9 lakh crores in Indian rupees should be created and managed within India rather than in international currency securities.
Currency Management: India’s current account management would become calibrated across approximately 175 currencies, utilising 150 years of Indian commercial banking experience to prevent volatility and manage fluctuations.
IMF SDR Valuation
The IMF’s SDR methodology must be simulated for India. For context, on March 20, 2026: SDR 1 = US$1.36334, US$1.00 = SDR 0.73349.
A revisit to the classics by Indian economists like Professor B. R. Shenoy and Dr. B. R. Ambedkar – grounded in 20th-century economic theory – will provide the basis for India’s economic flourishing.
This proposal was respectfully submitted for kind consideration to the PMO on 25th March 2026