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Government of India double import duty …

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Government of India double import duty on gold what will the effect on foreign exchange rate in the economy?

Posted by Sneha Kumari Shaw 3 years, 11 months ago

CBSE > Class 12 > Economics

1 answers

Sia ? 3 years, 11 months ago

Impact on foreign exchange rate due to increase in import duty on gold:

The import of gold will fall when the government increases the import duty on gold.
This reduces the demand for foreign currency.
With the supply of foreign currency remaining the same, the foreign exchange rate would fall. This implies an appreciation of rupees.

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