With dip in gold imports, government today ruled out any further hike in customs duty and said economic indicators like CAD will improve drastically if Indians do not import it for a year.
"I don't want to become too unpopular," Chidambaram said when asked if the government was mulling further duty hike.
Chidambaram's statement comes in the backdrop of decline in gold imports in the last few weeks.
"Net gold imports, averaged USD 135 million a day, in first 13 business day in May till May 20. However, in the subsequent 14 business days, it averaged only USD 36 million, so gold imports have sharply come down. But I would be happy if they come down even further," he said.
Huge gold imports have put pressure on the country's Current Account Deficit (CAD), which in turn is affecting the value of rupee.
The government has hiked import duty to 8 per cent recently to curb gold demand. The Reserve Bank has put restrictions on banks on importing gold.
Pointing out that there are other financial instruments which provide better returns than gold, Chidambaram urged people not to invest in gold.
"Suppose people of India don't import gold for one year, the whole situation will dramatically change. If we can have it for six months, one year, it will dramatically change the situation of CAD. And we will see its positive impact on every other index that measures the economy-- stock market, exchange rates, interest rates," Chidambaram said.