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From baubles to bars, India’s thirst for gold drains economy

Posted: February 24, 2013 at 2:48 a.m.

In this Thursday, Feb. 14, 2013 photo, an Indian woman looks into a mirror as she tries out gold jewelry at a shop in Mumbai, India. Nowadays, India is by far the world's biggest buyer of gold, which despite its rising value, is an increasing drain on an economy that is growing too slowly to reduce widespread poverty. Last year Indians imported 864 tons of gold, about one fifth of world sales. The cost of 2.5 trillion rupees ($45 billion) was second only to India's bill for oil imports. The unquenchable appetite for gold coins, bars and jewelry has swelled India's trade deficit and weakened its currency, making crucial imports such as fuel more expensive. (AP Photo/Rajanish Kakade)

India’s steep new tax on gold imports doesn’t deter Mousumi Rao as she holds up a glittering $5,000 filigree necklace that could adorn her daughter on her wedding day.

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Business, Pages 67 on 02/24/2013

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