The gold imports that have an impact on the CAD or Current Account Deficit of the country has fallen by close to 9% to the $24.64 billion during the period of April to January in the ongoing financial year in India as per the data which has come out of the Commerce Ministry. The imports of Gold had stood at a level of $27 billion in the period of one year ago.
The decline of the gold imports have helped in the narrowing of the trade deficit of the country to a level of $133.27 billion in the period of April to January of the fiscal year currently from a level of $163.27 where it was one year ago.
The imports of Gold have recorded a growth negatively since the month of July in the previous year however they have been recording a major positive growth in the months of October and November only for the contraction of close to 4% in the month of December and in this year 31.5% in the month of January.
India has been the biggest gold importer as it caters mostly to the industry of jewelry
In terms of Volume, the country is importing as much as 800-900 tons of gold every year. For the mitigation of negative impact of the gold imports on CAD and trade deficit,, the government has increased the metal’s import duty to 12.5% from 10%.
The experts in the industry feel that the sector’s businesses have been shifting their bases of manufacturing to other countries because of the higher duty levels.
Reduction of import duty to 4% had been demanded by the exporters of gems.