Synopsis: Prime Minister Narendra Modi has urged Indians to avoid buying gold and limit foreign travel for a year to protect India’s forex reserves, reduce pressure from rising oil imports, curb inflation, and strengthen the domestic economy amid global geopolitical tensions.
Prime Minister Narendra Modi has urged Indians to temporarily avoid buying gold and reduce international travel in response to growing economic and geopolitical challenges. The appeal comes at a time when India’s foreign exchange reserves are under pressure due to rising import costs, particularly crude oil and gold, both of which require large payments in US dollars.
The government believes that limiting non-essential imports and overseas spending can help strengthen the Indian economy during a period of global uncertainty. By encouraging citizens to choose domestic travel and reduce gold purchases, the initiative aims to conserve foreign exchange reserves, control inflationary pressures, support local industries, and promote economic self-reliance.
Protecting Forex Reserves
The primary motivation behind this appeal is the preservation of India’s Foreign Exchange (Forex) reserves. India’s reserves recently saw a significant drop of nearly $7.8 billion, falling to approximately $690.7 billion.
Because India imports more than 90% of its gold, buying the metal requires a massive outflow of US dollars. By pausing gold purchases, the government aims to reduce this non-essential dollar drain during a time of high global uncertainty.
Impact of Geopolitical Tensions
The timing of the appeal is tied to ongoing tensions in West Asia, which have already driven up global energy prices. Since crude oil is India’s largest import expense, the rising cost of fuel is already putting immense pressure on the national exchequer. PM Modi is urging citizens to cut back on gold the second-largest import category, to ensure there is enough foreign currency available for essential needs like fuel and energy.
Gold’s Economic Footprint in India
India is one of the world’s largest consumers of gold, typically using 700–800 tonnes annually while producing only 1–2 tonnes domestically. In the 2025–26 financial year, India’s gold import bill surged to a record $72 billion, a 24% increase from the previous year.
While gold is a culturally significant investment for weddings and festivals, policymakers argue that heavy imports do not contribute to industrial productivity or exports, making it a target for reduction during economic crunches. Prime Minister Narendra Modi has appealed to Indian citizens to avoid international travel for at least a year, citing several critical economic and geopolitical reasons.
Preserving Foreign Exchange
The central motive is the protection of India’s foreign exchange reserves. Amidst global instability specifically the U.S.–Iran crisis, PM Modi described conserving these reserves as an “act of patriotism.” By choosing domestic destinations over overseas vacations and avoiding destination weddings abroad, citizens can help stabilize the national economy against global shocks.
Managing Energy and Inflation
India’s heavy reliance on imported oil means that rising global energy prices lead to inflation and higher airfares. The PM framed the reduction of fuel consumption as a national responsibility, urging people to use public transport and electric vehicles. Minimizing the demand for imported petrol and diesel helps the country manage supply chain issues and energy costs more effectively.
Supporting Local Livelihoods
Choosing to travel within India provides a direct boost to the domestic tourism industry. This shift supports millions of workers, including hotel staff, tour guides, and local artisans. By redirecting travel spending into the local market, the initiative aims to build a more resilient and self-reliant economy.
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