Gold imports, which have a bearing on India’s Current Account Deficit (CAD), fell 8.86 per cent to $27 billion (about Rs 1.90 lakh crore) during April-February period of the current financial year, according to data from the Ministry of Commerce and Industries. The imports of gold stood at $29.62 billion in the corresponding period of 2018-19.
Gold imports have been recording negative growth since December last year. The decline has helped in narrowing India’s trade deficit to $143.12 billion during the April-February period this fiscal, as against $173 billion a year ago.
India is the largest importer of gold, which mainly caters to the demand of the jewellery industry. In volume terms, the country imports 800-900 tonnes of gold annually. To deal with the negative impact of gold imports on trade deficit and CAD, the Centre had increased the import duty on the metal to 12.5 per cent from 10 per cent earlier. Industry analysts claim that businesses in the sector are shifting their manufacturing bases to neighbouring countries due to the high duty.