Key UPA ally DMK today joined the Opposition in demanding rollback of hike in import duty on gold from 2 per cent to 4 per cent fearing it would encourage illegal trade of the precious metal.

Participating in the Budget debate in Rajya Sabha, DMK leader Kanimozhi said, "Increase in import duty on gold to 4 per cent is bound to put pressure. It will lead to smuggling."

Higher import taxes on gold would affect demand in India, where households view the precious metal as a saving instrument, she said.

Gold demand in India, the world's biggest consumer, stood at 933 tonnes in 2011, she said.

Bullion traders and jewellers are on strike across the country since March 17 protesting against the budgetary proposal to impose excise duty of one per cent on unbranded precious jewellery, and doubling of customs duty on standard gold bars and coins to four per cent.

On income tax exemption, Kanimozhi said, "the Budget ignored working women" and demanded that tax exemption be raised for this section of society.

Expressing displeasure over the proposal to disinvest PSUs, she said the government should re-think on its proposal to raise Rs 30,000 crore through disinvestment.

"Re-think on this. Is this the only solution to raise capital? We must explore other avenues," she said.

She also expressed concern over "poor" budgetary allocation for some schemes focused on women and child development.

The DMK member also demanded a separate department to focus on differently-abled people and excise duty exemption on a food item "sago", widely used in Tamil Nadu.