Gold imports drop 13.5% to $27.4 bn in 2016-17
The Dollar Business Bureau
Gold imports of India dropped by around 13.5% to $27.4 billion in the last financial year, which is likely to keep a tap on the mounting current account deficit (CAD).
In 2015-16, the country’s overall imports of the yellow metal stood at $31.7 billion.
As per the industry experts, one of the reasons for the drop is softening prices of the precious metal in the domestic as well as international markets.
The decline in imports has helped in narrowing down of the trade deficit to $105.7 billion in 2016-17 compared to $118.7 billion in the previous fiscal.
However, on a monthly basis, the imports of gold surged to $4.17 billion in March compared to $974 million in the same month year-ago, as per data by the Ministry of Commerce.
Being one of the largest importers of gold in the world, India has to depend on imports of gold mainly to meet the demand of gems and jewellery industry.
During the period April-December 2016-17, the country’s CAD halved to 0.7% as against 1.4% a year ago.
In terms of volume, the country imported 560.32 tonnes of gold in the period April-January of 2016-17.
On the other hand, overall gold imports were 968.06 tonnes in the entire fiscal of 2015-16 and 915.47 tonnes in the fiscal of 2014-15.
Currently, import of gold attracts a duty of 10%. The gems and jewellery sector, along with the Ministry of Commerce, has time and again prodded the Ministry of Finance to consider a reduction in the import duty on gold.