India's gold imports likely to pick up in coming months

India's gold imports likely to pick up in coming months
Following a three-month plunge, India's gold imports are likely to rise over the coming months as the festive season begins while officials clear many shipments which had earlier stopped due to confusion over new import rules.

According to the All India Gems & Jewellery Trade Federation (GJF), India's gold imports may rise in the next three months till December to reach 150 tonnes, touching 725 tonnes in FY 14. India's gold imports in the first six months of the current fiscal or the April to September period stood at 354 tonnes.

The country imported 118 tonnes of gold in April, 162 tonnes in May, 31 tonnes in June, 41 tonnes in July, 2 tonnes in August and nil last month, All India Gems & Jewellery Trade Federation said.

At present, India's total gold demand is nearly 900 tonnes annually. India is the biggest importer of gold in the world followed by China. India's gold imports virtually came to a standstill after the Reserve Bank of India in July tightened import rules as it stipulated that 20 per cent of gold imports must be converted into exports, mostly in the form of jewellery.

In a bid to stem a record current account deficit (CAD) and a record depreciation in the Indian rupee, the government and the RBI have upped measures to reduce gold imports. The Indian government also hiked import duty on the precious metal to 10 per cent from 2 per cent early last year.

Dion Global Solutions Ltd.

Read more about: gold, imports, cad, shipments, rbi, jewellery
Story first published: Monday, October 7, 2013, 9:11 [IST]
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