India’s gold imports declined by about 13.5 per cent to $ 27.4 billion in 2016-17, which is expected to keep a lid on the current account deficit. Total imports of the precious metal in 2015-16 amounted to $ 31.7 billion. According to industry experts, softening prices of gold in the domestic and world markets is among the reasons for the decline. The contraction in import helped narrowing the trade deficit to $ 105.7 billion in the last financial year as against $ 118.7 billion in 2015-16.
However, on a month-on-month basis, gold import jumped to $ 4.17 billion in March as against $ 974 million in the same month previous year, according to the commerce ministry data. India is one of the largest gold importers in the world, and the imports mainly take care of demand from the jewellery industry.
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During April to December period of last fiscal, the current account deficit halved to 0.7 per cent, from 1.4 per cent a year ago. In volume terms, as per data available, India imported 560.32 tonnes of gold during the April-January period of the last fiscal.
In contrast gold imports had aggregated to 968.06 tonnes in the entire 2015-16 fiscal, and 915.47 tonnes in 2014-15.
At present, gold import attracts 10 per cent duty. The gems and jewellery industry along with the commerce ministry have time and again urged the Finance Ministry to consider cut in the import duty.