Gold imports witnessed a fall of 30.5 per cent to USD 15.74 billion in April-November of the current fiscal, which is expected to keep a lid on the current account deficit. Total imports of the precious metal in the corresponding period of 2015-16 stood at USD 22.64 billion. Softening prices of the precious metal globally as well as locally are seen to be at work. However, gold imports grew for the second straight month in November by rising 23.24 per cent to USD 4.36 billion, according to the commerce ministry data.
Inward shipment had seen fall till September since February this year. It recorded a positive growth in October and last month. The increase in gold imports pushed the trade deficit to about two-year high of USD 13 billion in November from USD 10.33 billion in the same month last year.
India is one of the largest gold importers in the world and the imports mainly take care of demand from the jewellery industry. For the full year of 2015-16, CAD stood at USD 22.1 billion, or 1.1% of GDP, as against USD 26.8 billion, or 1.3%, in 2014-15.
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In volume terms, the country’s total official gold imports declined to 60 tonnes in April-July of this fiscal, much lower than 250 tonnes in the year-ago period. India imported 650 tonnes of gold in 2015-16. The imports remained stable at around 100 tonnes in November despite fall in sales of jewellery due to the cash crunch following demonetisation.
According to experts, the rural demand is affected due to the currency shortage after withdrawal of Rs 500 and Rs 1,000 notes announced on November 8. According to World Gold Council’s report, India’s gold demand declined 28% to 194.8 tonnes in July-September this year due to high prices and regulatory changes. The demand for the full year is expected to be in the range of 650-750 tonnes, it said.